BEIJING (BLOOMBERG) - China's top banking watchdog doubled down on a renewed push to rein in financial technology companies such as Ant Group, promising to eliminate monopolistic practices and strengthen risk controls in the industry.

Liang Tao, a vice chairman of the China Banking and Insurance Regulatory Commission (CBRIC), said at a conference in Beijing on Wednesday (Nov 11) that fintech don't change the nature of the financial industry and regulators should be attentive to the risks and challenges of digitization. Firms should be subject to the same supervision and risk management requirements as banks, he said.

Mr Liang's comments add to a widening crackdown on fintech firms, which last week derailed Ant's US$37 billion (S$49.8 billion) initial public offering. Regulators have roiled markets with a spate of new rules to curb their dominance and also targeted internet behemoths such as Tencent Holdings and Alibaba Group Holding, which owns a third of Ant.

Using big data gleaned from their hold on online payments, Ant and firms such as Tencent have grabbed market share from commercial banks in the lucrative consumer lending space by providing easier access to credit for younger users online, many of whom have little income nor credit history.

CBIRC called for better education for borrowers and bans on inducing customers to borrow beyond their needs and means. In areas where a market monopoly can be spotted, the regulator will step up probes to ensure fair competition and market order, Mr Liang said.

Licensed financial institutions should also assess the risks of their partners and are restricted from outsourcing their information technology, risk management and internal auditing, Mr Liang said.

THE CHORUS

Other speakers at the conference, including executives from Industrial & Commercial Bank of China and Beijing Financial Holdings Group, joined in the clampdown chorus.

Fang Wenzhong, chairman of Beijing Financial and a former CBIRC director, said none of the financial innovations have eliminated or even reduced risks. He said the Basel Accords weren't outdated, but developed from the lessons of the past financial crisis.

Those comments were in response to a speech late last month by Ant's billionaire founder Jack Ma, who compared the Basel capital rules to a club for the elderly. Ant, which operates the Alipay payments app, also spans lending, asset management and insurance.

Weeks after that speech, Mr Ma was called in to a joint meeting with regulators and told that Ant will be treated as a financial holding company and subject to capital and leverage regulations similar to banks, according to people familiar with the matter. The IPO was then called off.

"We believe the focus of this round of tightening will be establishing a new group-level regulatory framework for quasi-financial holding companies and improving and expanding the current regulations covering credit-related businesses," Daiwa analysts led by Leon Qi wrote in a note on Tuesday.