(Bloomberg) — Ant Group Co. said it will shutter its “mutual aid” health-care platform Xianghubao, following similar moves by other internet giants including Meituan and Waterdrop Inc., amid China’s crackdown on the once-booming fintech business.
Xianghubao, which uses crowd funding to help pay medical costs for critical illnesses, will cease operations Jan. 28 to protect the interests of all participants in the longer run, according to an emailed statement. Existing members will no longer bear claims settlement costs, it said.
The banking and insurance regulator said in January it was monitoring risks at firms engaged in crowd-funding in the health-care sector and would take “corresponding measures,” shortly after Meituan, whose main business is food delivery, closed its platform. Ant said the same day that the chief architect of Xianghubao had resigned. Waterdrop closed its mutual aid platform in March.
Internet mutual aid platforms have the features of commercial insurance but are unregulated, and their risks are “not negligible” as they have huge numbers of users, the China Banking and Insurance Regulatory Commission said in a policy research paper posted on its website in September 2020.
China has extended a yearlong campaign to curb the breakneck growth of its internet sector and what Beijing has termed a “reckless” expansion. The government unveiled sweeping regulations over the past week governing overseas share sales, tightening scrutiny on their international debuts in the wake of Didi Global Inc.’s controversial New York listing.
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