The Chinese regulators are doing what many western governments would like to do, crack down on Big Tech monopolies, but are too frightened, or bribed.
Regulators previously ordered Ant to split the businesses of AliPay from lending businesses Huabei and Jiebei. They now want the credit businesses to be split into an independent app as well, according to the FT.
According to the plan, Ant will turn over user data underpinning loan decisions to a new credit scoring joint venture, the FT reported, citing people familiar with the process. The JV will be partly state-owned, the report said.
What the move means is that state-backed firms are set to take a sizeable stake in the credit-scoring joint-venture, with Ant and Zhejiang Tourism Investment Group owning 35 per cent each of the venture.
Ant will not be the only online lender in China affected by the new rules, according to the FT.
In April, regulators ordered Ant Group to revamp its business, including restructuring into a financial holding company as well as creating more separation between its payment app Alipay and its credit products. In that same month, Chinese regulators also slapped Alibaba with a massive 18.23 billion yuan (about $2.8 billion) fine in its anti-monopoly investigation of the tech behemoth due to alleged abuse of its market dominance.