Adaptability to Changes--the Changing Situation of Finance in Digital Times
On May 21, 2013, the seminar of “Adaptability to Changes--the Changing Situation of Finance in Digital Times” was held in Shanghai. This is the sixth installment of Hongru Forum. Wan Jianhua, chair of Guotai Junan Securities, made a keynote speech. SIFL’s Gao Limin, Dehope Asset Management’s vice president Chen Yu and Alipay Payment Institute’s senior researcher Zhao Lan provided commentary. Liu Hongru Foundation’s Shen Danyi moderated.
At the beginning, Mr. Wan Jianhua made a brief introduction about his new book Financial E Time. In his opinion, China’s current relatively poor financial system is not so depressing when entered into the Internet age. There have been great changes in China’s finance industry. Though financial reforms provide vitalities to the development of finance, IT digitalization has made finance industry taking on an entirely new look. Wan emphasized that information technologies have drove the development of financial structure and promoted the mixed operation of finance, and also have impacted the separate operation and separated supervision.
In the internet age, Wan said that the platform is dominant. Though all participants formulate rules jointly, the specific operation is still decided by the operators of platforms. In the Internet financial age, those who have gained accounts will gain the world. For clients, the accounts have realized the integration of financial assets --the registration on one account, there is nothing to be worried about. For financial institutions, the integration of the businesses of financial institutions have been realized--the one-stop client services. The age of information technologies is also the time when currencies create diversification. Finally, Mr. Wan Jianhua points out the two directions for the future development of financial industry: the former is standardization, popularization and scale, and the latter is professionalization, individuation and customization.
Then, SIFL’s researcher Gao Limin noted that previously the integration between finance and Internet was not good for the mismatching of talents and incentive mechanism. In the internet industry, the collection and monetization of traffic flow are key factors. But in the financial industry, the business model is further emphasized, thus the talents of the two industries are unable to be connected, so the industrial integration has been hindered. At the same time, Gao asserted that the traffic flow of the Internet also is divided into the upstream and downstream, and the flow of the starting point is more valuable than that of the end point.
Alipay’s Zhao Lan introduced the current major businesses of Small and Micro Financial Service Group, including payment settlement, financing and businesses that relate to investment and management on money matters. Dehope’s Chen Yu defined the internet finance as crack finance which is the result in the process of specific financial system transition, together with the private lending in Zhejiang province, they all belong to the same kind of phenomenon. He noted that in fact it has compensated for the low efficiency of formal financial institutions in the market competition. At the same time, Chen questioned the model of Alipay’s Small and Micro Finance. He pointed out that though the performance of Alipay Small and Micro Finance is excellent, it was not suitable for the demanders of other small and macro finance, thus making its scale be limited by the scale of Taobao. And viewing at present, the scale of Taobao is limited.
In the process of discussion, the participants carried out heated discussions on issues of financial risk control and the response measures of financial institutions under financial computerizing.
“Hongru Forum” is a public seminar jointly launched by Liu Hongru Financial Education Foundation and Shanghai Institute of Finance and Law, and is held regularly once in two weeks. The seminar pays attention to various issues in China’s finance and macro-economy, and devotes itself to building a platform for cross boundary exchanges among excellent scholars, government and market institutions.
