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Its Fintech Business Will Be Shrunk And Stock Broker Ops Sold, Says ByteDance


09/02/2021


Its Fintech Business Will Be Shrunk And Stock Broker Ops Sold, Says ByteDance
The financial services business of the Chinese firm ByteDance, the owner of the short video haring app TikTok, will be shrunk down while it would sell off its stock broking business unit, the company said on Wednesday, in the face of Chinese regulatory authorities clamping down on the financial technology (fintech) sector.
 
ByteDance owns and operates Songshu Zhengquan, which translates to Squirrel Securities, in Hong Kong, and Haitun Gupiao, or Dolphin Stocks, in mainland China.
 
In recent months, the financial regulator in China has been increasing its scrutiny of companies in the financial technology sector, and has directed firms operating in the sector to set up financial holding companies if they meet a set preconditions or requirements as decided by the regulator. The aim of this move is to maintain strict capital requirements for such companies.
 
For example, Alibaba's fintech affiliate Ant Group was ordered by the regulator to change in into a financial holding company. 
 
According to reports close to ByteDance, the company had never given priority to its financial technology business and to its expansion while keeping its focus on industries such as e-commerce and gaming and trying to expand them to diversify sources or revenues and growth.
 
The third party mobile payment owned and operated by ByteDance, Douyin Pay, helps facilitation by users undertaking on e-commerce transactions on short video sharing app Douyin, the Chinese version of TikTok.
 
Douyin also makes available Ant's Alipay and Tencent Holdings' WeChat Pay, China's two ubiquitous third party mobile payment channels.
 
Earlier this week, ByteDance annolucned it had acquired a virtual reality start-up called Pico marking the Chinese company’s first move virtual reality space.
 
The size or worth of the deal was not revealed by byteDance, headquartered in Beijing, China, but said in a statement that the “comprehensive suite of software and hardware technologies of Pico, as well as the talent and deep expertise of the team, will support both our entry to the VR space and long-term investment in this emerging field.”
 
According to IDC, Pico had achieved a 44 per cent year on year growth in shipments of its virtual reality headset in the virtual reality headset which made it the third-largest VR headset maker globally for the quarter.
 
(Source:www.economictimes.com)


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