The annual “Two Sessions” meeting of China’s top legislative bodies has sent a slew of strong signals on the future development of the Chinese fintech sector.
The near fortnight-long meetings of the National People’s Congress (NPC) and the Chinese People’s Political Consultative Conference (CPPCC) kicked off in the first week of March, with a multiple delegates voicing opinions and recommendations for China’s fintech sector.
Wang Jingwu (王景武), NPC representative and head of the People’s Bank of China’s (PBOC) financial stability bureau, called for trials of a “regulatory sandbox mechanism.”
According to Wang a regulatory sandbox for the fintech sector is an effective mechanism for greatly reducing the appellation time for financial innovations and cutting down on compliance costs.
A regulatory sandbox can also “organically unify the two key functions of financial stability and finance servicing the real economy, and be of benefit to regulatory authorities performing their regulatory duties, expediting regulation of financial innovations.”
Liu Yonghao (刘永好), CPPCC representative and chair of New Hope Group, has called for the accelerated launch of data legislation and a push for increased data sharing, while also preventing the illicit collection and use of data by fintech companies.
According to Liu this will reduce the difficulty and costs for financial institutions to obtain data, and reduce the problem of information asymmetries.
“[This] will thus drive the provision of more inclusive and targeted financial services by financial institutions, and resolve the problem of finance being difficult and expensive for enterprises and individuals,” said Liu to Securities Journal.
Liu Shangxi (刘尚希), CPPCC representative and head of the Chinese Academy of Fiscal Sciences, also pointed to the ability of fintech to resolve the financing challenges of small and medium-sized enterprises.
“In order to solve this problem, [we] can resort to the development of fintech for a solution…in rarity there are already successful case studies.”
Zhang Jin (张劲), CPPCC and chair of Cedar Holdings, called for the establishment of a shared service platform for supply chain financing that makes use of technologies including big data and the blockchain, and is connected to key participants including financial institutions, core enterprises, small and medium-sized enterprises and third party logistics providers.
According to Zhang this can achieve online information sharing, online product services, online transaction of non-standard assets, as well as facilitate policy dissemination and off-site regulation.
Zhou Hanmin (周汉民), CPPCC representative and vice-chair of the China National Democratic Construction Association, submitted a proposal entitled “Guiding the Integration of Private Enterprise into National Strategy and Actively Advancing the Integration of the Yangtze Delta Region,” which recommends accelerating the application ofthe Internet, big data, cloud computing and the blockchain to the sphere of government services.
Neil Shen (沈南鹏), co-founder and head of Sequoia Capital China and special adviser on innovation and technology to the Hong Kong Special Administration Region, submitted a proposal on the secure transmission of financial data within the Greater Bay Area of Guangdong, Hong Kong and Macau.
The proposal makes specific reference to existing barriers against the flow of information and data, and the acceleration of trials for facilitating the flow of funds, human capital and resources.
Pony Ma (马化腾), NPC delegate and chair and CEO of internet giant Tencent, has submitted seven written proposals at the Two Sessions this year, touching upon multiple areas including the Industrial Internet, the Greater Bay Area, basic scientific research and environmental protection.
In the proposal entitled “Recommendations Concerning Accelerating the Development of the Industrial Internet and Expediting the High-quality Development of the Real Economy” (关于加快发展产业互联网促进实体经济高质量发展的建议) Ma outlines a total of range of recommendations.
These include “vigorously advancing the creation of basic information infrastructure, fortifying the foundations for the growth of the Industrial Internet; expediting the innovative growth of cloud computing, accelerating the digitisation of the real economy, pragmatically achieving breakthroughs in core technologies, and effectively achieving safety protections for the Industrial Internet.”
“At present the Chinese economy has already transitioned from a phase of high-speed growth to high-quality growth, and accelerating the growth of the Industrial Internet will have major significance for the high-quality growth of the real economy,” said Ma to domestic media.