- China looks to require Tencent Holdings Ltd (OTC:TCEHY) to include WeChat Pay in a newly created financial holding company, Bloomberg reports.
- The overhaul may mandate a new license for the universal mobile payments service subjecting it to intense regulatory scrutiny jeopardizing the one-stop-shop appeal reviving investor angst.
- Tencent needs to fold its banking, securities, insurance, and credit-scoring services into a financial holding company subject to regulations like Alibaba Group Holding Ltd (NYSE:BABA) founder Jack Ma's Ant Group Co.
- Also Read: Alibaba's Market Cap Has More Than Halved Since Ant IPO Debacle, After Alibaba, Tencent Could Attract Regulatory Penalty
- Ant's estimated valuation plunged to $63 billion from over $300 billion partly due to the stricter regulations of being a financial holding company.
- Regulators weighed whether WeChat Pay could be included in that holding company and operate separately from the leading social media arm.
- China previously ordered Tencent and other internet firms to disassociate financial services from its primary business.
- Price Action: BABA shares closed lower by 4.33% at $100.43 on Thursday.
