Nothing is easy in the banking industry, and it's getting tougher in China. The Chinese central bank (PBOC) used to control banks’ lending and deposit interest rate by setting high and low limits, as the top line and bottom line in the chart. If a bank in China can always lend/borrow at the limit rates, the margin would not change much over the years. However, the story is not that simple.
In its recent mobile app update, Alipay has put its QR code for accepting payments away from the main screen to a separate button on the top right corner. This seemingly small technical change has operational and business implications too.
Over the past year, China's Consumer Finance industry has been attracting a significant amount of attention. It may be the next hot spot for financial development in China.
The RuPay is an initiative by the National Payments Corporation of India (NPCI). It is intended to provide a domestic alternative to the global MasterCard and Visa card payment systems. It will also allow NPCI to consolidate various payment systems in India. It is directly comparable to its Chinese counterpart, China UnionPay, which has been highly successful and is a world leader in payment systems.
China’s consumer finance industry is booming amid the rising level of consumption among the Chinese Millennials group, a population representing nearly one-third of China’s whole population. The scale of the industry has been pushed to RMB 107.72 billion by total asset value by September last year, almost doubling the scale of RMB 51 billion in 2015.
The launch of the Shenzhen-Hong Kong Stock Connect on December 5, 2016 was an important next step in the liberalization of China’s capital markets. The platform will offer a new opportunity for foreign firms to access the Chinese capital markets through the Shenzhen Stock Exchange, which is prominent for its technology stocks and exhibits higher returns than the Shanghai Stock Exchange, partly because its listed companies are newer and smaller.
Last Friday, the People’s Bank of China (PBOC), China’s central bank, issued a new notice for the third party payment companies which will be enacted on April 17th, 2017 and will require the payment companies to deposit around 20% of the held customer fund to specified general bank accounts.
Since the start of this year, there have been many news about the set up of “Wang’Lian”, which means Non Bank Internet Payment Union, in China.
December 6th, 2016 China Merchants Bank (CMB) held its press conference in Shen’Zhen, China, for its new AI wealth management product: MachineGene Investment, or “Mo’Jie” in Chinese. The launch represented the first time a Chinese bank released a wealth management product based on AI/Robot technology.
Recent announcements in the personal credit scoring market in China show that both global established giants and smaller, but cutting-edge companies are carving out niche markets for themselves in the country.