China has said that it will fine banking companies more than $1bn (£778m), including Ant Group, the tech giant owned by Jack Ma.
Regulators said that laws protecting consumers and rules for running a business had been broken.
The company, which runs the payment service Alipay, was one of the most visible targets as officials tried to get a tighter grip on the sector.
They also made it clear that this was the last time they would crack down on the business.
In the statement, the Chinese central bank and securities regulator said they were ending their drive to reform tech giants and switching to more “normalised supervision.”
The central bank said that as part of Ant’s fine, more than 550 million yuan (£59 million) in “ill-gotten income” was taken away.
Ant, which helps hundreds of millions of people and small businesses with loans, credit, investments, and insurance, said it would “strictly follow the terms of the penalty.”
Investors were happy to see signs that the crackdown was coming to an end, so shares of e-commerce giant Alibaba, which has a big stake in Ant Group and is traded in the US, went up nearly 10% in New York trading after the news.
In recent years, doubts about risky loans and President Xi Jinping’s efforts to give the government more control over the economy have made the tech sector of China less attractive as an investment.
After a speech by Mr. Ma that was seen as critical of the government, the plans for Ant Group to go public were suddenly put on hold in 2020. This caused worries that have cost the sector billions of dollars.
Many people saw Ant’s rise as a threat to the way the government ran the country’s finances, since the government was worried about people’s debt and loans in the private sector getting out of hand.
In the past few years, the country has also put out a lot of new rules for tech companies. These rules cover things like data security and competition.
After a probe into monopolies, Alibaba had to pay a $2.8 billion (£2.1 billion) fine in 2021. The Chinese ride-hailing giant Didi and the food service company Meituan were also given fines.
Ant Group’s peer Tencent, which makes WeChat and TenPay, will pay a fine of nearly 3 billion yuan (£323 million) that was also announced on Friday.
Ma Huateng, the head of Tencent, said that he thought the government could now “support and encourage platform companies.”
Mr. Ma used to teach English but became a fortune when he started Alibaba in 1999. He gave up control of Ant Group in January and returned to China after a long time away in March.
