Shanghai aims to be leading fintech center within five years

It will take three to five years for Shanghai to become a leading global financial technology center, according to a new action plan released by the city government on Friday.

Financial technology, or fintech, refers to the innovation of products and services provided by the traditional financial industry through various technological means for more efficiency and reduction of operating costs.

As a growing trend in the industry, fintech is based on a series of technological innovations such as big data, cloud computing, and artificial intelligence, which can be applied to financial fields such as payment, financing, and retail banking, according to the Financial Stability Board's definition.

"There exists fierce competition worldwide in the financial sector, so it's high time for Shanghai to enhance its global competitiveness in fintech," said Gu Ping, deputy director of the financial committee office of the Shanghai Committee of the Communist Party of China.

"The action program launched today is exactly a concrete initiative to reach this goal," said Gu.

There are 31 initiatives in seven areas in the new plan.

They include exploring the establishment of an expert advisory committee for the construction of a financial technology center in Shanghai, building a large-scale financial corpus database in Shanghai, constructing a big data innovation laboratory for health insurance, and promoting the interoperability and sharing of data between health insurance and commercial insurance.

Meanwhile, a "regulatory sandbox" mechanism for fintech will be built to provide regulatory advice and policy support for fintech innovation.

The government will also set up a special fund for Shanghai's fintech industry, as well as a training base for fintech talents, being part of the Shanghai Fintech Innovation Program, to increase international exchanges and cooperation.

"Shanghai is already a preferred base for fintech companies and talent, as the central bank has made great efforts to promote the development of fintech in Shanghai," said Shi Jiandong, director of the science and technology division of the second department of financial services at the Shanghai headquarters of the People's Bank of China.

In 2017, the central bank set up a fintech committee.

It also issued a fintech development plans for 2019-2021 and 2022-2025.

"In recent years, more international exchanges through large-scale events such as the Bund Conference have promoted the flow of information and technological innovation within different sectors and industries, making Shanghai increasingly vibrant and internationally attractive," said Gu.