China has quickly became the global frontrunner in financial technology and is leaving the rest of the world painfully behind.
Indeed, half of the global investment in financial technology is happening in Asia, according to the World Economic Forum. Most of these investments are in China.
In a panel discussion in Davos titled the Global Fintech Revolution, top Chinese and global financial players discussed the changing financial landscape and the possibilities and threats that lay ahead.
The Chinese fintech revolution is most evident when it comes to mobile payment, as the country is undergoing a groundbreaking shift away from cash to digital payments – a sector dominated by Alibaba’s Alipay or WeChat’s payment service.
“The new generation of financial systems will be more inclusive, focusing on the underserved or unserved, including small-to-medium-sized enterprises (SMEs). Many of them could not get access to financial services before. But today it’s different as we can bring financial services to underserved people”, said Eric Jing, Chief Executive Officer of Alibaba’s financial arm, Ant Financial Services Group, the world’s most valuable fintech unicorn at US$60 billion.
In one small county in Tibet, for example, 90% of overall electronic payments are made through mobile payments, Jing claimed.
China’s banking system remains relatively undeveloped. One in five Chinese adults don’t have accounts, while around 80% of small and medium-sized enterprises are not adequately served by banks.
Among the country’s 710 million internet users – more than the United States and Europe combined – the utilization ratio for mobile online payments stands at 57.7%. In other words, more than half of the online population are using their smartphones to pay for goods and services.
Speakers in the Davos discussion also included Henry Blodget (Chief Executive Officer and Editor-in-Chief, Business Insider Inc), Francisco González (Group Executive Chairman, Banco Bilbao Vizcaya Argentaria SA), Dan Schulman (Chief Executive Officer, PayPal Inc), David Craig (President, Financial and Risk, Thomson Reuters), and Cecilia Skingsley (Deputy Governor, Swedish Central Bank).
I can see why. I worked in a small town outside Guangzhou for seven months. I was amazed by the super efficicnecy of their China mobile servies and banks… I had all transactions smsed to me with absoluetly accurate figures almost as soon as. I noticed all colleagues shopped and paid online… and they were very quick too.
The heavy investment is in a significant part due to rich but unsophisticated investors in China. I just heard about a bicycle sharing company that raised in the order of $250 million, but they only have like 20,000 bicycles.
There’s very much a herd mentality going on where the sheep pile on when Tencent or Alibaba put a stake in.
Secondly, China has been treating the influx of foreign credit cards as a national expense to be minimized much as they did with Windows OS. The circumstances for Chinese fintech are thus markedly different than most of the rest of the world.
Do you need a quick long or short term loans with a Relatively low interest rates as low as 3%? We offer business loans, personal loans, home loans, auto loans, student loans, real estate loans, debt consolidation loan etc no matter your score, if yes contact us and apply today, write us now through email: guaranteedplc@gmail.com