Douyin and Kuaishou fined for micro loan ad leading to excessive consumption

Chinese video-sharing app Douyin and Kuaishou have been given a fine by the Chinese government for publishing a micro load ad that attracted the audience to excessive consumption, according to multiple reports such as the South China Morning Post. Both companies were fined ¥200,000 (US$ 31,287) by the State Administration for Market Regulation (SAMR) in the Haidian district of Beijing. The related ad violated China’s advertising law which bans campaigns regarded by authorities as going against a good social climate or disturbing the public order.

The ad is produced by JD Technology, the financial technology arm of eCommerce giant JD.com. According to SCMP's report, it is about a man travelling on a plane with his mother. He is concerned about his mother's wellbeing as she is airsick-prone, and takes out an instant loan via a JD.com app to get the money before upgrading her to a cabin seat.  JD technology apologised for the ad in December last year and said it was not sensitive enough to people who did not earn a lot of money. In July, JD.com was given a ¥400,000 fine for the commercial.

Moreover, SAMR also confiscated the revenue worth of ¥39,400 and  ¥74,200 yuan from Douyin and Kuaishou respectively based on the companies’ records on the National Enterprise Credit Information Publicity System. The behaviour of the two app operators was said to have “serious value problems that preached incorrect orientation such as excessive consumption”.

The Chinese authority is still tightening its grip on tech companies in the country and app operators have limited the use of its services. For example, all of ByteDance's Douyin's authenticated users below 14 will now access the app in a youth mode. In the youth mode, under-14 users can only access the app for up to 40 minutes a day, and only between 6am and 10pm, said the organisation. According to multiple reports, the company said the latest measure was aimed at protecting the youth, and it is the most stringent in the history of the platform.

According to an article in May by Chinese state news, Global Times, this new offering ensures that young users can only see content which is exclusively made for their age group and limits their access to services such as publishing content, watching live broadcast or tipping streamers. According to the article, for users between 14 and 18 years old, the platform will also provide protection through content recommendation and search. 

Meanwhile, other popular social messaging apps have also rolled out measures to prevent young users from accessing games and functionalities, as well as searching nearby friends. For example, WeChat owned by Tencent also has a youth mode. When turned on, the users have limited access some games and payment functions. 

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