Ant Group Reportedly Won’t Get Financial Holding Company License for Months

Ant Group may not see progress on its application for a license from China until the second half of the year or later.

The Chinese FinTech aims to obtain a financial holding company license and become a fully regulated company, but its efforts have been delayed as China restructures its financial regulatory system, the Wall Street Journal (WSJ) reported Friday (May 5), citing unnamed sources.

With the license, Ant Group would complete its restructuring and be regulated like banks and other financial institutions in the country, according to the report.

However, it has been waiting more than a year already while government officials consider who will lead a new financial regulator that is being created and that will have to approve the company’s application, the report said.

The process of forming and staffing the new regulatory body and considering the application could take months, so Ant Group’s efforts will be delayed, per the report.

Similarly, Ant Group is waiting for approval of an application for a credit scoring license that it submitted in 2021. This application is being held up as China creates a national data bureau and determines how that bureau will share the governance of credit scoring with the central bank that does so now.

As PYMNTS reported in February, Ant Group’s quarterly profits plummeted following a long-term crackdown on China’s tech sector.

Before that, the company’s planned $37 billion initial public offering (IPO) was blocked by regulators in China at the end of 2020.

In January, Ant Group announced that its founder, Jack Ma, would give up control of the firm. At the time, the company also said it had no plans for an IPO.

China’s increased regulatory oversight of Ant Group was part of a broader crackdown on the tech sector which saw officials imposing billions in antitrust fines. This led to shares in Big Tech firms plummeting and some companies putting their listing plans on hold.

In February 2022, Chinese authorities said the biggest state-owned firms and banks need to start a fresh round of checks on financial exposure and other links to Ant Group.