China ordered Tencent to create financial holding – report
Tencent Holdings, which includes gaming, technology and finance entities, was ordered by the Chinese authorities to create a separate financial holding where all businesses related to financial services would be consolidated, Caixin reported on Wednesday citing multiple sources close to the matter.
The move is set to make governmental supervision of the company’s financial affairs easier. The reorganization would involve mobile payments, lending and insurance operations. The order is seen by experts as a signal of a widening crackdown on tech groups due to alleged potential systemic risks to financial stability and their enormous market power.
The announcement falls in line with the rectification plan imposed by China on Ant Group company earlier this year. China’s State Council also ruled last year that nonfinancial firms with finance services must obtain special licenses.
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