{"id":253777,"date":"2018-06-25T07:21:03","date_gmt":"2018-06-25T05:21:03","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=253777"},"modified":"2018-06-25T07:21:03","modified_gmt":"2018-06-25T05:21:03","slug":"tencent-is-creating-online-platform-for-chinese-bonds","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/internet\/253777\/tencent-is-creating-online-platform-for-chinese-bonds\/","title":{"rendered":"Tencent is creating online platform for Chinese bonds"},"content":{"rendered":"
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Tencent Holdings is joining forces with a finance startup to create a system for over-the-counter bond deals, banking on its appeal to the army of traders that already rely on its popular messaging services.<\/p>\n

China\u2019s biggest social media and gaming company and its partner is launching the service Friday after almost two years of fine-tuning. As envisioned, the QTrade service will help traders meet online and negotiate prices.<\/p>\n

It verifies both parties\u2019 identities and logs their conversations and transactions for at least five years, thus complying fully with securities regulations, said Zhou Jingyu, a co-founder of the Shenzhen-registered startup.<\/p>\n

Tencent\u2019s potentially offering a way out for brokers grappling with tightening scrutiny from China\u2019s securities watchdog, which from December is banning traders from using individual email and messaging accounts to place orders – their main transaction avenue.<\/p>\n

While the government has its own chat system for dealers, more than 70% of bond trades are now conducted over personal messaging accounts such as Tencent\u2019s QQ messaging service, QTrade estimates. That\u2019s a source of growing concern for regulators wary of financial and security risks, given China issued bonds worth 40.8 trillion yuan ($6.3 trillion) last year.<\/p>\n

\u201cThere\u2019s been a discrepancy between where traders complete their deals and where they negotiate,\u201d said Fiona Liu, another co-founder of the company. \u201cWe want to provide a safe and compliant instant messenger to make sure that trading activity is regulatory compliant.\u201d<\/p>\n

The service is targeted at professional investors. While deals can be negotiated through the platform, all transactions still have to be processed through official channels, such as the China Foreign Exchange Trade System, also known as CFETS.<\/p>\n

QTrade will also provide analysis tools that allow regulators to search by users or timeline and format trading data, said Zhou, whose company is registered as Shenzhen Pingguoshu Shuju Keji Ltd. in Chinese but doesn\u2019t have an English name. Bloomberg LP, the parent of Bloomberg News, also provides data, news and analytics for bond trading in China.<\/p>\n

The stepped-up scrutiny on traders using social media isn\u2019t unique to mainland China. Hong Kong\u2019s securities watchdog banned a brokerage employee from the industry for four months after he used his phone and Tencent\u2019s WeChat to take orders from clients. Last year, a former Jefferies Group LLC banker was fined in the UK for sharing confidential data on WhatsApp.<\/p>\n

Tencent, whose QQ has more than 800 million active users, said in a statement the platform will leverage its messaging, big data and machine learning technology, while complying with regulations to lower risk.<\/p>\n

Zhou, a former Tencent employee, joined forces with ex-trader Liu two years ago to found the company, which now has operations also in Beijing and Shanghai. They knew at the time it would be extremely hard to get traders to move away from QQ, so they collaborated with the social media giant. QTrade allows users to import their contact lists on QQ, and add as many as 100,000 people.<\/p>\n

Zhou wouldn\u2019t disclose how it\u2019s sharing revenue with Tencent. He said the company is in the process of securing a second round of fundraising but declined to comment on whether Tencent is an investor or disclose its backers.<\/p>\n

\u201cTencent is able to do so much, but it can\u2019t possibly cover everything, that\u2019s why it prefers to be a platform and work with companies within different verticals to share the benefits,\u201d said Zhou.<\/p>\n

\u201cFinance is a highly professional field, we have a very experienced team in this area. That\u2019s why they want to work with us.\u201d<\/p>\n

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Read: Naspers profits massively from Tencent disposal<\/a><\/strong><\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

Tencent Holdings is joining forces with a finance startup to create a system for over-the-counter bond deals, banking on its appeal to the army of traders that already rely on its popular messaging services.<\/p>\n","protected":false},"author":59,"featured_media":196098,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[9882],"tags":[26,1977],"class_list":["post-253777","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-internet","tag-headline","tag-tencent"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/253777","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/59"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=253777"}],"version-history":[{"count":1,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/253777\/revisions"}],"predecessor-version":[{"id":253781,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/253777\/revisions\/253781"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/196098"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=253777"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=253777"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=253777"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}