On May 31, Nikkei Asia reported that WeChat Pay was being urged to decrease its market share, primarily in the sector of offline payments facilitated by QR code scans. This did not pertain to online shopping. WeChat’s official account promptly debunked this news as false.
At the start of 2024, Tencent convened its annual company meeting in Shenzhen. Pony Ma, Chairman and CEO of Tencent, addressed issues related to Tencent‘s fintech and internet sector. He underscored that payments were the most crucial part of this sector and the only area where controlling market share was necessary. He explained that half of these shares were directly deducted from bank cards, and the other half were transfers, which did not constitute payments. Hence, Ma emphasized the need for risk mitigation and product transformations in the future. He clarified that “Tencent‘s role is as a channel or conduit, not a competitor to banks”.
Regarding other financial products like loans and insurance, Ma also acknowledged their novelty but expressed confidence in their significant growth potential through internet-based models, while stressing the importance of risk management.
Tencent released its Q1 2024 financial report on May 14. According to the report, the company’s revenue for the first quarter saw a 6% year-on-year increase, reaching CNY 159.5 billion. The adjusted net profit also rose by 54% year-on-year to CNY 50.27 billion. Concurrently, the company’s online advertising business, fueled by the growth of WeChat Channel, Mini Programs, Official Accounts, and the Search function, witnessed a 26% year-on-year revenue increase, amounting to CNY 26.5 billion.
The central bank of China has enacted a regulation, effective from May, that presents a stringent stance towards monopolistic practices in the financial sector. The rule stipulates that any non-bank payment institution found to be engaging in monopolistic behavior will be subject to punitive measures. However, the regulation does not provide explicit definitions or examples of the types of activities that would be considered monopolistic, leaving room for interpretation and application.
SEE ALSO: ByteDance Denies that ‘TikTok Proposed Transferring Control to the U.S. Government in 2022’
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