TikTok parent company ByteDance has secured a $29.6 billion loan from nearly 30 banks as it ramps up spending on artificial intelligence, according to a report by Reuters, citing people with direct knowledge of the transaction.

Strong lender demand allowed ByteDance to raise the dollar-denominated facility from an initial $20 billion target. Banks from China, the United States, Europe, and Singapore are participating in the loan, which is being coordinated by Citigroup and JPMorgan. Chinese banks subscribed to more than 60% of the total, one source said.

"It is very rare to see such a mega loan unsecured," one source told Reuters. "The banks practically are counting purely on ByteDance's name."

ByteDance reportedly told lenders that the three-year loan, which can be extended by two years, was for general corporate purposes. However, Reuters' sources said the money would mainly fund overseas AI projects, including data center capacity in Southeast Asia. Building AI infrastructure abroad requires heavy capital outlays for chips, servers, and power-hungry facilities, which is one reason leading AI developers have turned to large debt and equity raises rather than operating cash flow alone to fund expansion.

The loan follows a period of heavy investment across the AI sector. A January 2025 report said ByteDance planned to spend up to $12 billion on chips and overseas infrastructure, though the company disputed the figures. Two months later, OpenAI secured a $40 billion SoftBank-led funding round, while ByteDance's Doubao chatbot ranked fourth in an August survey of mobile AI usage. SoftBank later sold its $5.83 billion Nvidia stake to help finance its OpenAI investment.

Chinese developers are also competing on price. In May, DeepSeek and Xiaomi sharply cut the cost of their AI models, widening the pricing gap with leading American systems.

ByteDance's expansion comes as Beijing tightens its AI oversight. In July, the company removed customizable agents from Doubao ahead of new restrictions on humanlike AI services. Chinese officials have also discussed limiting overseas access to advanced domestic AI models, potentially complicating ByteDance's international plans. How those regulatory discussions resolve, and how the loan proceeds are ultimately deployed, are likely to shape the company's overseas AI rollout in the years ahead.