Call to upgrade homegrown fintech capabilities

Industry experts and financial-technology service providers called for the upgrade of homegrown financial-technology capabilities to further elevate the financial sector and boost the digitalization of other industry sectors.

Zhou Yanli, a researcher at the counsellors' office of the State Council and former deputy chairman at China Insurance Regulatory Commission, expects the insurance industry to be a forerunner in terms of digital transformation.

He said the operation efficiency and sophistication level of service in the insurance sector should be further enhanced despite initial progress in the realm, as digitalization is becoming a prerequisite for all insurance service providers.

It's also a basic demand to leverage financial-technology measures in order to counter potential cybersecurity risks, as large amounts of data are leveraged for daily operations and business decisions.

Zhang Jun, dean of the Fudan University School of Economics, said financial-technology solutions should focus more on small and micro businesses at the grassroots level.

He also noted that the digitalization of financial services would help resolve financial imbalances and further serve underfinanced groups.

The digitalization of financial services offers tailor-made solutions for small and micro businesses and helps mitigate risks for commercial lenders.

"Financial-technology service players serve a positive role to help avoid the mismatch of financial resources, and they should stick to serving the grassroots financial and consumption market in the long run," he said at the ABC Summit hosted by Xinhua news agency's affiliate China Economic Information Service and Baidu AI Cloud on Friday.

Weng Hongjie, head of China Guangfa Bank Shanghai Branch, said financial technologies have already helped expand wealth management products' customer base and enhanced its risk-control schemes.

China's asset management industry was valued at 12.1 trillion yuan (US$1.89 trillion) in 2020, but the sector still lags behind in terms of predictive algorithms to mitigate risks, according to the Deputy General Manager of the China Economic Information Service Zheng Bin. He said further efforts in smart data technologies are needed to meet risk control and regulatory compliance requirements.

He Haifeng, chief economist at Guotai Junan Securities, also expects more synergy between financial-technology service providers and district-level government agencies.

Guotai Junan signed a framework deal with Putuo District earlier this month to push forward collaboration in a wide range of areas, including industry development, financial innovation, asset management and state-asset reforms.