Ant Group is opening its consumer credit data trove to Beijing

Image: REUTERS/Shu Zhang
We may earn a commission from links on this page.

China’s effort to get its tech giants to open up their stores of consumer data is yielding results.

The company’s virtual credit card service Huabei, part of Chinese fintech giant Ant Group, said yesterday (Sept. 22) it will share its credit information with the credit reporting database overseen by China’s central bank, which is used by hundreds of financial institutions to check creditworthiness.

The move, which comes as part of a restructuring of Ant Group that followed the cancellation of its IPO last year by Chinese regulators, marks a key success for Beijing in its tussle with private tech giants to make their data more publicly available. Huabei—whose name means “just spend”—has over over 190 million users whose minimum credit line (pdf, page 193) could be as low as 20 yuan ($3). China has become increasingly concerned about both corporate and consumer data, and the inclusion of Huabei’s data will deepen information about household borrowings, now equivalent to 62% of GDP.

In a letter on Weibo addressed to users, Huabei said it would share information monthly, including account setup dates, credit line amounts, and repayment status, after obtaining user consent. The company said it would not submit users’ personal consumption details, such as items purchased or the date and time of the purchase.

“We recommend that users continue to maintain rational use of Huabei, spend within their means, and make appropriate use of credit tools,” added the company.

Huabei and Jiebei (“just borrow”), Ant’s other consumer lending business that makes larger loans than Huabei, together form the backbone of Ant’s credit tech segment. Jiebei hasn’t at this time made a similar announcement.

Ant’s shift from providing mobile payments through its Alipay wallet into consumer loans, now a core part of the company’s business, spurred regulatory concerns about financial risk that helped spur the decision to force an overhaul of the company. As part of that, both Huabei and Jiebei will be housed in a new consumer finance division Ant set up in June. While they are still currently embedded in Alipay, Ant could also be required to put the lending services into a separate app.

The integration of Huabei’s data with the central bank is another example of Beijing’s ongoing efforts to tame its tech giants, whose data and other resources the government eyes both as drivers of growth but also windows into economic and national security risks.

In March, the Financial Times reported that the central bank was said to be unhappy about the slow progress of Ant’s sharing of its credit data. In the months since then, a slew of new data laws laying out Beijing’s priorities, and an increasingly harsh regulatory crackdown, are putting tech firms in a more giving mood.