Ant is unworried by new loan regulations

Ant Group, the parent of the Chinese dominant mobile payment app, said China's new online loan regulation will not have a material impact on its business.

China's financial regulators plan to cap the interest rates Ant Group can charge borrowers on quick consumer loans, a move that could curb the financial technology giant's biggest revenue driver. That came as Ant is reportedly poised to US$30 billion (HK$234 billion) joint initial public offering in Hong Kong and Shanghai as soon as next month.

The owner of Alipay has shifted its focus to online lending, which contributed 39.4 percent of total revenue in the first half. The digital payment sector accounted for 35.9 percent of Ant's total revenue during the period, down from over half before 2018.

Loans made by Ant Group and other consumer lenders will be subject to a ceiling imposed by a China Supreme Court ruling last month. Linked to a benchmark rate, the cap is currently 15.4 percent. The court said the rule doesn't apply to licensed financial institutions, but it so far hasn't specified whether it would impact fintech firms such as Ant.

In response to the Shanghai Stock Exchange's IPO vetting, Ant said the company is cooperating with financial institutions to offer customer loans, but the detailed implementation of the new rule remains unclear.