Anthony Kwan | Bloomberg | Getty Images
Mobile payment platforms Apple Pay in addition to also also Alipay are displayed for a photograph in Hong Kong, China, on November 1, 2016.
Alibaba Group affiliate Ant Financial has banned consumer loans with annual interest rates above 24 percent by its Alipay platform, a move which comes as China’s government increases scrutiny of lightly regulated online lending.
Ant Financial, which operates Alipay, confirmed to Reuters the item has introduced the rule for business partners to better protect consumers.
the item said the item has recently stepped up inspection of financial product providers on Alipay in addition to also also Sesame Credit, its credit platform, in addition to also also found some problematic cases involving “interest rates above the legal limit in addition to also also inappropriate collection methods.”
Ant said the item might continue to monitor in addition to also also remove noncompliant businesses in addition to also also asked all to conduct self checks by Nov. 30.
The move comes after the government This particular week took steps to tighten supervision of the lightly regulated sector of online lending, leading to companies scrapping plans to go into the business.
The government on Tuesday issued a notice asking provincial authorities to suspend regulatory approval for fresh internet micro loan companies in addition to also also to restrict granting approvals for companies to conduct lending across regions.
Companies providing modest loans, especially over the internet, have expanded rapidly within the past year in China, partly due to loose regulation.