(Bloomberg) — Jack Ma’s Ant Group is planning to create a new consumer finance company to bolster its market share in the country’s fast growing online lending industry.

Ant is working with Nanyang Commercial Bank Ltd., China TransInfo Technology Corp. and Contemporary Amperex Technology Co. to build a consumer finance platform that will focus on doling out loans to individuals in China, people familiar said, requesting not to be named because the matter is private. The Chongqing incorporated company will have a registered capital of 8 billion yuan ($1.2 billion).

China TransInfo Technology jumped as much as 10%, the daily limit, while Contemporary Amperex Technology rose 4.3% in the afternoon trading session.

The new entity would boost Ant’s lending capacity since consumer finance companies are allowed to lend out 10 times their capital. That would far surpass the two to three times leverage of Ant’s existing micro-loan companies in Chongqing, which operate its Huabei and Jiebei platforms.

Consumer finance is getting increasingly competitive in China. More than 20 such companies have emerged after the banking regulator started a pilot program in 2010 to promote purchases of durable goods such as home appliances. Such firms, while unable to take deposits, can fund their loans by borrowing from the interbank market, shareholders and issuing bonds and asset-backed securities.

The China Banking and Insurance Regulatory Commission said last year it would relax requirements for both foreign and Chinese companies to invest in and set up consumer finance companies. Online lending in China reached 965 billion yuan in 2019, according to a report by researcher WDZJ.

Ant is still in the process of seeking a consumer license for the company and could start operations in weeks, the people said.

Ant declined to comment in an emailed statement. Nanyang Commercial Bank, China TransInfo and Contemporary Amperex Technology didn’t immediately respond to requests for comment.

Ant said last month that it would start the process of a dual listing of its shares in Hong Kong and Shanghai. The new business could create a new revenue stream for the $210 billion company that operates the Alipay payments app, money market funds and provides credit scoring.

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