Days after CEOs of the world’s leading technology companies were subjected to antitrust hearings at the US Congress, there were certain sources They argue that Beijing could soon investigate its own digital monopolies.
A Reuters report published on July 31 cites anonymous sources that claim that the People’s Bank of China officially recommended the State Council’s Cartel Committee Start an investigation into the activities of the digital payment titans Alipay and WeChat Pay.
The central bank has allegedly argued that both have used their upward stance to suppress potential competition in the area of digital payments.
If approved, an antitrust investigation could be imminent
According to analysis statistics cited by Reuters, the Chinese mobile banking sector processed transactions worth around 56.2 trillion yuan ($ 8 trillion) in the last three months of 2019.
Analysys appreciates that AliPay, managed by Alibaba subsidiary Ant Group, and Tencent’s financial technology business (mainly WeChat Pay) account for 55% and 39% of the country’s mobile banking market., respectively.
One of the unidentified Reuters sources said the PBoC had told the committee’s State Council to investigate possible cartel problems in the second quarter of 2020.
Investigations could throw cold water on Ant’s IPO plans
The report notes that the PBoC has already taken steps to weaken the dominance of both companies by announcing plans to standardize interoperability of QR code payments to help smaller companies enter the market.
In the event that a formal antitrust investigation is opened, the news could be a major blow to Ant Group’s highly anticipated double listing in Shanghai and Hong Kong, which is targeting an approximately $ 200 billion IPO.
On the recommendation of the central bank, the State Council’s antitrust law has been collecting information on both digital payment platforms for more than a month, according to the sources.
While apparently The committee has not yet decided whether to launch an investigation or notthe call of the PBoC is said to have taken “very seriously”.
Meanwhile, the same sources claim that both Ant Group and Tencent are intensifying their lobbying efforts to prevent government officials from supporting the action.
In addition to the internal success of its mobile payment services, China is one of the leading providers in developing and testing an upcoming central bank digital currency.