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Financials

UPDATE 1-China's Meituan to shut down mutual aid programme at end January

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BEIJING, Jan 15 (Reuters) - Chinese food delivery giant Meituan said on Friday it would shut down its online health care mutual aid programme at the end of January.

The company will focus on its main business after the closure of the mutual aid service, it said in a statement.

Meituan’s decision follows a recent tightening of regulations for financial technology firms by the financial regulator.

Mutual aid programmes provide users with a basic health plan covering various types of critical illnesses and participants share the risk of becoming ill and bearing the medical cost.

One of the leading providers in the emerging industry is Ant Group’s Xiang Hu Bao, which was launched in 2018 on Alipay and has since accumulated hundreds of millions of users.

Others include Tencent-backed Waterdrop and ride-hailing giant Didi Chuxing.

Last month, the Banking and Insurance Regulatory Commission (CBIRC) said all financial activities needed to be overseen by regulators and all businesses needed to be licensed to operate.

The central bank last month said Ant Group was drafting a plan to set up a financial holding firm and the company should ensure that all of its financial operations were under regulatory supervision.

Mutual aid platforms are not licensed by the CBIRC. Once licensed, the platforms need to comply with tough capital requirements and other risk management requirements that apply to licensed insurers. (Reporting by Yingzhi Yang in Beijing and Brenda Goh in Shanghai Editing by Jan Harvey, Robert Birsel)

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