Saturday, 2024 July 20

US reportedly considers restrictions on Ant Group, Tencent’s payment systems

The Trump administration is considering to tighten restrictions on Ant Group and Tencent (HKSE: 0700) due to national security concerns posed by their payment solutions, in a further move to target Chinese tech companies, Bloomberg reported on Thursday, citing sources.

In recent weeks, senior officials in the White House have been discussing potential restrictions on China’s largest digital payment platforms due to concerns that, when Ant Group and Tencent dominate the fintech sector globally, China would have access to banking data and other sensitive personal information of users, according to the report.

The idea is still preliminary and it’s difficult to find a mechanism and legally sound approach. The matter hasn’t been presented to President Donald Trump, who has contracted the coronavirus.

Jack Ma’s Ant Group, the operator of mobile payment and wealth management app Alipay with more than 1.2 billion users, will be listing in Hong Kong and China this month, avoiding US bourses amid escalating China-US trade tensions. The long-anticipated blockbuster IPO is set to raise up to USD 35 billion, valuing the Alibaba spinoff at more than USD 200 billion.

Tencent’s payment system, WeChat Pay, runs inside WeChat, the ubiquitous messaging app that the Trump administration attempts to ban alongside TikTok. Tencent’s revenues from fintech and business services increased by 30% year-on-year (YoY) to RMB 30 billion (USD 4.4 billion) in the second quarter of 2020. Its Hong Kong-listed stock dropped slightly by 0.37% to HKD 533 on Thursday morning.

An Ant Group spokesperson responded to Bloomberg that the company is unaware of the discussions within the administration, that its “business is primarily in China and we are excited about our growth prospects in the China market.” Tencent declined to comment on the issue. Alipay and WeChat pay both are not mainstream payment choices in America and mainly used by Chinese staying overseas.

Wency Chen
Wency Chen
Wency Chen is a reporter KrASIA based in Beijing, covering tech innovations in&beyond the Greater China Area. Previously, she studied at Columbia Journalism School and reported on art exhibits, New York public school systems, LGBTQ+ rights, and Asian immigrants. She is also an enthusiastic reader, a diehard fan of indie rock and spicy hot pot, as well as a to-be filmmaker (Let’s see).
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