Ant Group – formerly Ant Financial – was the biggest of China’s unicorns for a long period, although its fall from grace with government regulators since late 2020 has seen it overtaken by Bytedance in valuation terms.

Ant’s business model continues to be scrutinised by the central government, with new directives that it must commit more of its own capital to the loans that it arranges. For instance, its consumer finance unit will now need to provide 30% of the funding for loans that originate on its platform. These new capital requirements have skewered Ant’s valuation in the private market, with reports in June 2021 that it had dropped below $200 billion in value, a fall of more than $100 billion on earlier in the year. Speculation later in June was that the shares had fallen even further, as much as 60% from their peak in the run-up to the failed IPO last year.

Ant has its origins in Alipay – the online payments tool that supported Alibaba’s spectacular rise as the emperor of e-commerce over the last decade. The payments platform then morphed into a fearsome fintech, taking a fee to connect borrowers on its online platform with lenders, primarily banks. But Ant became too big for the government’s liking. Fears that it could fuel a dangerous wave of consumer borrowing are now forcing it to refocus on its payments platform roots.

For more on tumultuous events around Ant’s failed IPO last winter, read how the financial world was waiting for the record-breaking debut before the listing was pulled at the last minute. Since then Jack Ma has come under heavy government pressure to revamp Ant’s business model

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