Ant Group announced it will shut down its online crowdfunded medical aid service Xianghubao on Jan. 28, a decision that comes at a time of tightening of financial technology regulations in China.
Ant, the fintech affiliate of retail giant Alibaba , said on Tuesday that it had made the decision as “the mutual aid industry has undergone significant changes” in the past year, and that the move aimed to protect the interests of users.
Xianghubao provides users with a basic health plan covering various types of critical illnesses. Signing up is free, but all members share the medical costs of any becoming ill.
Dubbed as “mutual aid”, the industry has been under regulatory scrutiny since last year as regulators tighten financial business of online platforms.
China’s Banking and Insurance Regulatory Commission (CBIRC) has said since last year that all online financial activities must be overseen and licensed by regulators. Mutual aid platforms are not licensed by the CBIRC.
One of the other leading players in the mutual aid industry, Tencent-backed Waterdrop Inc, shut down its service in March, while food delivery giant Meituan closed its service in January.
Ant said Xianghubao had served more than 100 million members, and that 179,127 users who fell ill had received aid from the platform since the service was launched in 2018.