Business / Companies

Tencent stepping further into e-finance

By Meng Jing (China Daily) Updated: 2014-06-27 07:06

Kingdom Technology will help QQ build the financial service platform to directly link more securities companies with QQ users.

The move is seen as Tencent's latest attempt to push further into China's emerging Internet finance sector. Tencent's rival Alibaba Group Holding Ltd was a pioneer in this sector in China by launching Yu'ebao last summer.

Yu'ebao, designed to make it easy for Alibaba's Alipay users to invest their idle cash and get a higher interest rate than typical bank savings deposits, has gained great popularity in China, especially among young people.

Many Internet companies have followed Yu'ebao's lead by launching wealth management services.

"Through teaming up with technology solutions provider Kingdom, Tencent certainly has serious plans about Internet finance," said Qian Haili, an Internet finance analyst with the China E-Commerce Research Center.

She said that Tencent's agreement with Shenzhen Kingdom can be seen as a counterattack against Alibaba, whose founder Jack Ma in April announced a plan to pay 3.3 billion yuan ($531.78 million) to take a controlling stake in financial software firm Hundsun Technologies Inc.

"Both of these two companies have great ambitions in Internet finance. And QQ, which has a monthly active user population of more than 800 million, can serve as a great base to promote Internet finance," said Qian.

"However, since people are used to having fun on QQ by chatting with their friends, many may find it difficult to treat it as a serious platform for wealth management," she said.

Report:online finance to be reined in

As China perfects its regulatory policies, the Chinese Internet finance sector will slowly grow to become a supplementary part of the traditional finance sector, according to a report released by BOCOM International Holdings Co Ltd on Thursday.

It quoted Zhang Xiaopu, a policy research official at the China Banking Regulatory Commission, as saying that even as China's Internet finance sector attracts more and more participants, it may trigger systemic risks, necessitating a higher level of regulation.

Tencent stepping further into e-finance Tencent stepping further into e-finance
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