The head of the Chinese central bank’s tech department has highlighted the benefits that fintech can bring to China’s payments sector.
In an article written for the Payment and Clearing Association of China, Li Wei (李伟), tech chief for the People’s Bank of China (PBOC), said that “in recent years fintech innovations have been in ascent, with the in-depth integration of information technologies such as mobile internet, artificial intelligence, big data and cloud computing with payments operation driving the continuous innovation and development of the payments sector.
“Payments and technology are comparable to twin brothers…business innovation is intimately related to technology, and risk control is also closely linked to technology.”
Li Wei pointed to the transition from diffusion to centralisation as being the culminating stage in the developmental history of payments technology.
“Operations key are a major pillar for payments services, and the People’s Bank of China has advanced with the times to continue to drive the modernisation of China’s payments system in accordance with the principles of unification, high-effectiveness and safety.
In addition to creation of an online interbank-bank payments system and a bank card inter-bank settlements system, PBOC has overseen the launch of a non-bank payments entity online payments and clearance platform, in order to centralise settlement between commercial banks and payments companies, and established the Cross-border Interbank Payments System.
According to Li the latest technological advances are helping to raise and efficiency and convenience of payments.
“The level of payments convenience is steadily increasing, and the application of technology in the payments sphere is driving a revolution in payments tools, procedures and platforms, enabling the masses to enjoy even more quick and convenience payments services.
“Payments tools are more convenient, with each advance saving time and effort, from specialist tools (bank cards) to general devices (mobile phones) to external accoutrements (wearable devices) to the body itself (facial recognition).
“The average person has no need to worry about forgetting or losing their wallet, and can complete payments while travelling light.
“Payment service costs have fallen markedly…firstly in terms of reductions in equipment investment costs, second is terms of reductions in transaction management costs, and third in terms of reductions in risk control costs.”