China‘s central bank said on Friday it had accepted the application to set up a personal credit-scoring joint venture backed by Alibaba’s fintech affiliate Ant Group and other firms.
The new venture, Qiantang Credit Rating Co Ltd, will become the third personal credit-scoring firm in China if officially approved by regulators.
It will be registered in Hangzhou, Zhejiang province with a capital of 1 billion yuan ($156.50 million), the central bank said. The city is where Alibaba and Ant are based.
Ant and the state-backed Zhejiang Tourism Investment Group Co Ltd would each own 35% of the venture, according to a statement by the People’s Bank of China (PBOC).
Other state-backed partners, including Hangzhou Finance and Investment Group and Zhejiang Electronic Port, would hold 6.5% each.
Transfar Group, a non-state-backed shareholder, would hold 7%. The remaining 10% would be held by a private equity firm.
The set-up of the venture, in which Chinese state firms will take big stakes, is part of Ant’s sweeping business revamp ordered by regulators who put a sudden stop to its blockbuster initial public offering (IPO) last November.
The government has pushed for state-backed firms to exert more influence over fast-growing but lightly regulated new-economy businesses, Reuters has reported.
It also serves as the central bank‘s year-long attempt to link loan data among different online lending platforms, and tighten controls in credit information sharing to prevent over-borrowing and fraud.
Before Qiantang, the central bank had approved Baihang Credit in 2018, China‘s first licensed personal credit agency with nine parties co-invested, including credit rating units of Ant and Tencent Holdings.
It granted a second such approval to set up Pudao Credit Rating in December 2020, a venture between the investment arm of the Beijing government and subsidiaries of e-commerce giant JD.com and smartphone maker Xiaomi Corp.