The Trump Administration is exploring restrictions on billionaire Jack Ma’s Ant Group as well as Tencent Holdings Ltd. over concerns that their digital payment platforms threaten U.S. national security. The Final Round panel breaks down the details.
Video Transcript
JEN ROGERS: So moving on to a story I am calling TikTok part deux– Dan Roberts, you have been covering this news– reports that the Trump administration is exploring, which is kind of how the TikTok stuff started, too, frankly, they are exploring what to do about Ant Group and Tencent payments, AliPay, as they are getting more into the US.
They’re not widely used here yet. But maybe they could be. What is the Trump– what are the stories here about the Trump administration? Because I kind of feel like it’s starting the same way that the TikTok stuff did.
DAN ROBERTS: Well, you’re right. And this was first reported by Bloomberg. But let’s make sure we get the caveat. These are reportedly just preliminary talks. And in fact, the Bloomberg story and others have noted that no plan is even imminent. And by the way, there might not be a Trump administration in two months or three months. We have to see what happens there.
If you are Ant Financial, which is anticipating a mega IPO dual listing in Shanghai and Hong Kong, you are not concerned yet. And in fact, the response from Ant was basically just, we are a Chinese company with very little operations in the US. That is true.
I’ve covered Ant Financial closely for last few years because it quietly became the most valuable, privately held tech company in the world, although it didn’t get much attention. It is the formerly within Alibaba and then spun off payments unit. And most importantly, Ant Financial includes AliPay, that app that has so many users in China and in other Asian countries.
AliPay still has no presence in the US, other than the fact that if you already have a Chinese bank account and you are a tourist in the US, you can use AliPay to pay at a lot of big merchants. And the one big way that AliPay has gotten more into the US is by making partnerships with those merchants, I believe Walgreens, a couple other big names.
And then vice versa is also the case that US tourists in China can use AliPay over there while in China. Of course, right now, with the pandemic, you don’t really have any China US tourism happening.
Now it’s not just Ant Financial and Alibaba that are concerned here. As you mentioned, it’s TenCent. And TenCent’s equivalent fintech payments product is WeChat Pay, or We Pay. So we did talk about Tencent when we talked about TikTok. You’re right. I mean, there was a lot of speculation that, well, if they’re going to do TikTok and they already did Huawei, then what would logically be the next target? Tencent.
So you know, there is some concern here that this IPO, which, by the way, seeks to raise more than $30 billion, which would eclipse Saudi Aramco. If it happens and if the numbers are as they’ve been reported, it’s going to be the largest IPO in the world. You know, you might have some concern over that IPO now, according to this report.
But again, it all depends on, A, if Trump gets re-elected in the first place because I don’t think Joe Biden would be doing this, but who knows? And then, B, even if Trump is re-elected, it’s all very unclear what, if anything, the course of action would be.
So it’s sort of a nonstory, but it’s also the hints, the beginnings of maybe a story, as you mentioned. I remember when President Trump just kept getting asked about TikTok. What are you doing about TikTok? And he started to say, mm, we’re looking into it. Yeah, we’re looking into it.
And then suddenly, it became, all right, we’re going after TikTok. So you’re right, it could become a problem. But I would bet you that Ant and Alibaba and Jack Ma are not yet panicking over this.
