China’s Internet finance giants have completed the full withdrawal of bank deposit products from sale to both old and new customers via their platforms following a sharp rise in pressure from regulators.
Third party internet platforms including Alipay and JD.com had removed all bank deposit products from sale via their platforms as of 27 January according to a report from Diyi Caijing.
“In December last year Alipay, JD Finance Didi Finance and others successively removed online deposit products for sale to new consumers,” said one banker to Diyi Caijing. “In the past few days, in response to regulatory demands, old consumers have also been unable to purchase deposit products on these online platforms.”
The development arrives in the wake of a sharp tightening of online finance regulation in China towards the end of last year.
In November Sun Tianqi (孙天琦), head of the Chinese central bank’s financial stability department, compared the sale of deposit products by smaller banks via third party platforms to “quenching thirst with poison.”
In December Alipay, JD.com, Du Xiaoman and Tencent began to suspend the sale of bank deposit products via their platforms to new customers in response to directives from Chinese regulators, and on 15 January the China Banking and Insurance Regulatory Commission issued new rules banning banks outright from selling deposit products via third party online platforms.