HONG KONG, June 10, 2017 /PRNewswire/ — On 2nd June, world-renowned financial magazine, The Economist, hosted a summit titled “Finance Disrupted: Asia“ in Hong Kong. In addition to Morgan Stanley’s Managing Director, Crawford Jamieson, President of UBS Asia Pacific, Kathryn Shih, Executive Vice President of ANZ Group, Farhan Faruqui, and other international leading experts, a group of outstanding representatives from China’s internet banking industry, including CEO of Neo Financial, Linda Wong, CEO of Yirendai, Yihan Fang, and other well-known financial professionals were also invited to participate in the summit.
With favorable factors such as a user base of more than 1 billion and growing demands for personal financial services, does China have the opportunity to dominate the global FinTech industry development? At the summit, CEO of Neo Financial, Linda Wong and McKinsey partner, Vinayak HV, launched an engaging discussion on the topic of “China vs The World: Who Will Win The FinTech Revolution?“
Strong Influence, but will it be difficult to apply this business model worldwide?
McKinsey’s partner, Vinayak HV, acknowledges China’s current influence. However, he casted doubts that China’s FinTech will continue to take the lead in the future, especially after 20 years. He shared the possibility that China may be overtaken by other Asian countries and suggested that China’s FinTech model of putting technology before finance may be difficult to copy and apply in other markets. Secondly, China’s FinTech industry has yet to experience a complete economic cycle and therefore needs to undergo market test.
“It is precisely because of technology that allows Internet finance companies to better provide financial services with the Internet thought process in mind. This is a very important starting point. Simultaneously, technology ensures the quality of risk control and compliance with regulatory management. The market has vast potential,” Linda noted. As one of the pioneers of China’s Internet finance industry, she has witnessed the rise of Internet finance and the step-by-step process of the disruption of traditional banking. She believes that China’s economy environment, business model, the uniqueness of market demand, has created the “Uniqueness” of China’s FinTech business model. This is one of the important reasons why China’s FinTech industry is in the world’s leading position.
Linda further pointed out the similarity between China’s e-commerce development model and the development of Internet finance. The latter can predict its future development based on the former. The e-commerce industry covers online shopping, logistics, Big Data on personal consumption and personal credit etc. With a strong e-commerce industry, China was ultimately able to promote the establishment of the entire ecosystem.
Market potential is big, but is regulation the key to China’s FinTech development?
According to CEO of Neo Financial, Linda, China has one-fifth of the world’s population and the growth of the new middle class has stimulated a huge demand for personal financial services. In the future, China’s FinTech still has vast potential in terms of financing, investment and market size. Chinese FinTech’s performance in recent years has captured the world’s attention. In 2015, China has become the world’s largest FinTech market.
“In the process of globalization, China’s FinTech has to go global too. In the face of current regulatory tightening, no one can tell if the development of China’s FinTech may be hampered.” McKinsey partners believe that the rapid development of China’s Internet finance industry holds a certain degree of risk, which may become a constraint to its future development. Currently, other markets in Asia are developing rapidly as well and they have the same market potential. The shortcomings of the credit environment and the lack of credit awareness in China are urgent problems to be solved.
In this regard, Linda shared that although China’s FinTech has yet to establish a mature personal credit mechanism like those in developed countries, she believes that with the implementation of regulatory practices and advancement of technology, this challenge will gradually be resolved along with the fine-tuning of the market.
At the meeting, Vinayak HV said that regulatory tightening could affect the continued development of FinTech in China. On the implementation of regulation, Linda Wong believes it is timely. This allows the whole ecosystem to have a more sustainable and stable development. Most of China’s FinTech companies are not large and are still in their infancy. However, with rapid development and the increasing impact of FinTech, if there is a lack of regulatory authority, it will lead to risk accumulation. Therefore regulatory intervention is necessary for both the Chinese market and the global market.
Event Introduction
With the arrival of FinTech, the traditional finance industry is facing a challenge that cannot be ignored. There are views that FinTech is the future of finance, as well as views that FinTech is seriously overestimated. On June 2, global leading finance magazine, The Economist, hosted a summit in Hong Kong, titled “Finance Disrupted: Asia“, with more than 200 policymakers, senior business leaders, entrepreneurs and leading specialists attending the conference to explore the future of global FinTech and the impact of the digitalization of the financial services industry. Economists hope that elites from different fields are able to communicate with each other at this summit, coming together to look at how technology-driven disruptive enterprises are shaping the Asian financial scene, as well as exploring the roles of old and new enterprises in this ever-changing financial eco-system.
SOURCE Neo Financial
Global development photo credit: laveupv.com via Visual hunt / CC BY-NC-SA
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