China Continues To Dominate Global FINTECH Industry

[JSCh]

Asia Times | Alibaba launches two blockchain subsidiaries | Article
China tech giant launches more platforms, with focus on big data, fintech, finance and supply chain management

ByLUKE THOMPSON

Beijing’s stance on digital currencies has been well documented. Publicly, it wants nothing to do with them and will not permit its population to trade or own them.

The underlying blockchain technology remains of great interest, to both business and the state.

One of China’s largest ecommerce enterprises, Alibaba, is taking a closer look at this with the launch of two new blockchain affiliates via its payment arm Ant Financials. Ant Blockchain Technology and Ant Double Chain Technology will be launched in the district of Huangpu in Shanghai, according to local media.

Ant Blockchain Technology reportedly will be focussing on software development, big data, infotech and technical consulting, while Ant Double Chain Technology will look towards fintech research and development, financial information services and supply chain management.

Alibaba has been big on blockchain for some time now and has more than 10% of the world’s blockchain patents registered. “We are the most patented company in the world of blockchain technology,” said Jing Xiandong, Ant Financial CEO.

Ant Financial, formerly known as Alipay, is China’s leading online and mobile payments service provider with more than 500 million users. In June last year, the firm announced the launch of its first blockchain-based electronic wallet cross border remittance service between Hong Kong and the Philippines.

At the time, CEO Jack Ma said: “Blockchain should not be a tech to get rich overnight. There are still 1.7 billion people in the world who have no bank accounts, but most of them have mobile phones. The impact of blockchain on the future of humans may be far beyond our imagination.”

A subsidiary of Alibaba Group, Tmall Global, has also started running tests on blockchain technology to trace imported goods. QR codes and laser marks will be used in conjunction with the distributed ledger to track goods as the platform operates like an immigration department.

The Chinese state does still have some reservations over blockchain, however. Beijing has started to see blockchain as a threat to its information control efforts and recently announced new regulations that require users of blockchain-based services to provide full identification details, national ID cards and phone numbers.

 

[JSCh]

China’s ‘funds by phone’ culture leads the world | Financial Times

 

[TaiShang]

Alipay and six European digital wallets join hands to increase adoption of mobile payments with QR code

• TECH NEWS
• Monday, 10 Jun 2019
  
  By Zen Soo

The six wallets are working with the Chinese payments provider towards rolling out a QR code format provided by Alipay, so that users of any wallet will be able to make mobile payments at merchants across Europe that already accept payments for the other wallets. — SCMP

Six mobile wallets in Europe together with Alipay will collaborate and adopt a unified Quick Response (QR) code for mobile payments, allowing users of each wallet to pay for their purchases across 10 countries in Europe.

The six European mobile wallets include Austria’s Bluecode, Finland’s ePassi and Pivo, Oslo-based Vipps, Spain’s Momo as well as Portugal’s Pagaqui. The wallets are working with the Chinese payments provider towards rolling out a QR code format provided by Alipay, so that users of any wallet will be able to make mobile payments at merchants across Europe that already accept payments for the other wallets.

For Alipay users, they will also be able to pay at merchants who have already adopted the same QR code format.

The collaboration will bring together over 5 million users in Europe and over 190,000 merchants, according to a joint statement by the companies. ePassi and Bluecode will offer technical services to the participating wallets to simplify the integration process among them.

“We feel honoured to help promote a smart lifestyle and digital experiences in Europe, while continuing to connect more merchants with more Chinese tourists,” said Eric Jing, chairman and chief executive at Ant Financial.

The collaboration between the different European mobile wallets will help provide a bigger market for these payments providers, since it will help connect “Europe’s thriving yet fragmented mobile payment landscape”.

Alipay and its rival, Tencent’s WeChat Pay, have in recent years made a concerted overseas push to capture a share of the lucrative growth in Chinese outbound tourism. Chinese tourists took 140 million trips overseas last year, according to China’s Ministry of Tourism.

Since its establishment, Ant Financial has amassed more than 1 billion annual active users together with its mobile wallet partners in Asia. It is currently valued at US$150bil (RM624.48bil) after raising about US$14bil (RM58.28bil) in the biggest-ever single fundraising round globally.

The two online payments platforms allow Chinese tourists to pay for their overseas shopping directly within the Alipay and WeChat apps, with purchases settled in yuan. Use of credit cards, by comparison, typically incurs foreign transaction fees. – South China Morning Post

 

[Adam WANG SHANGHAI MEGA]

Paying with Your Face is coming!

 

[lcloo]

Can China please consider develop cashless e-payment for tourists, like temporary time limit e-wallet where no local bank account and China telephone No. is required?

I know we can pay in cash but we want to pay like the locals do. Just last week, we took out a few RMB1 currency note to pay for a purchase. The cashier said he has never seen RMB1 paper note before, only coins had he seen. And the account people of our tourist guide told us he got a little problem counting all those RMB100 notes we paid for the travel package because he had not touched paper currency in months.

Please let us tourists pay like the common folks in China, we want to spend money with ease.

 

[JSCh]

Chinese, Thai central banks partner over fintech
Source: Xinhua| 2019-06-10 20:32:51|Editor: mingmei

BEIJING, June 10 (Xinhua) -- China's central bank has partnered with its Thai counterpart over fintech development.

Yi Gang, governor of the People's Bank of China (PBOC), signed an agreement with his Thai counterpart Sunday on the sidelines of a G20 financial leaders' meeting in Japan, the PBOC said on its website.

The agreement aims to enhance partnership in innovation, joint research, information sharing and regulation in the field of fintech.

The two parties are willing to nurture an ecosystem conducive to fintech development in a bid to support innovation and technological advancement, reduce cost and improve financial product and service efficiency, according to the PBOC.

 

[oprih]

China loves to dominate this day just like how they dominate the spineless and submissive muricans. Well done China!

 

[Cmdr Keen]

China loves to dominate this day just like how they dominate the spineless and submissive muricans. Well done China!

I knew it...same pakistani poster....philiphino my a**.....

you are in every chinese post...posting nothing of value......but just .....
cheer leading whatever posted about china.... LOL

 

[oprih]

I knew it...same pakistani poster....philiphino my a**.....

you are in every chinese post...posting nothing of value......but just .....
cheer leading whatever posted about china.... LOL

You post the same shit over and over again. Go harass someone else fag, i'm not interested in your advance, it's disgusting.

And use proper punctuation, capitalization, grammar, etc.

 

[JSCh]

China's Third-Party Online Payments Tripled That of Banks in First Quarter
LU HONGAN
DATE : JUL 04 2019/SOURCE : YICAI

China's Third-Party Online Payments Tripled That of Banks in First Quarter​

(Yicai Global) July 4 -- China's third-party mobile payment platforms facilitated 148.5 billion transactions in the first quarter of this year, up 38.4 percent annually and more than tripling the number of digital payments made via banks, according to official data.

The value of payments via non-bank institutions rose 13.4 percent to CNY58 trillion (USD8.4 trillion), the People's Bank of China said in a report yesterday.

Alipay, the payments app run by Alibaba affiliate Ant Financial Services Group, commanded a 45.6 percent share of the market, with Tencent Holdings' WeChat Pay following up at 33 percent, according to earlier data from Analysys International. China UnionPay Merchant Services, a subsidiary of China UnionPay, came third with a 9.3 percent share.

Despite conducting far fewer transactions, digital payment at banks amassed CNY742 trillion (USD108 trillion) as consumers put more faith in traditional institutions when sending larger sums of money. Mobile payments at banks grew significantly, surging 80 percent in number and 2.2 percent in value over the year.

The number of bank cards in issue was up 2.3 percent at 7.8 billion as of the end of March. Bank account holders had 5.6 cards on average and made 64.5 billion transactions in the quarter, up 50 percent from a year earlier while the value of card payments surged 43 percent to nearly CNY222 trillion.

 

[JSCh]

Jack Ma’s US$290 billion loan machine at MYbank is changing Chinese banking, in a harbinger of the financial industry’s revolution | South China Morning Post
MYbank has lent 2 trillion yuan to nearly 16 million small companies, with a default rate of 1 per cent

Bloomberg
Published: 1:47pm, 29 Jul, 2019
Updated: 1:55pm, 29 Jul, 2019

Ant Financial Services owns 30 per cent of MYBank. Photo: Xinhua

Jack Ma’s online bank is leading a quiet revolution in the way China lends to small businesses, taking aim at a credit bottleneck that has held back Asia’s largest economy for decades.

Using real-time payments data and a risk-management system that analyses more than 3,000 variables, Ma’s four-year-old MYbank has lent 2 trillion yuan (US$290 billion) to nearly 16 million small companies. Borrowers apply with a few taps on a smartphone and receive cash almost instantly if they’re approved. The whole process takes three minutes and involves zero human bankers. The default rate so far: about 1 per cent.

The financial-technology boom that turned China into the world’s biggest market for electronic payments is now changing how banks interact with companies that drive most of the nation’s economic growth. As MYbank and its peers crunch reams of new data from payment systems, social media and other sources, they’re growing more comfortable with smaller borrowers that they previously shunned in favour of state-owned giants.

For China’s US$13 trillion economy, which expanded at its weakest pace since at least 1992 last quarter, the implications could be profound. Non-state firms – mostly small businesses – account for about 60 per cent of growth, employ 80 per cent of workers, and have been disproportionately squeezed by a more than two-year government crackdown on shadow lenders.

​

SCMP Graphics

“Small and medium enterprises are really the boiler room of the economy,” said Keith Pogson, global assurance leader for banking and capital markets at Ernst & Young based in Hong Kong. “It used to be a segment that banks thought was too difficult and too risky. But now they run their model and work out what the risks are so they feel more comfortable.”

China is quickly becoming a world leader in the use of big data and artificial-intelligence technology to make loans, according to Cliff Sheng, co-head of Greater China financial services at Oliver Wyman, a consulting firm. Among the country’s biggest advantages: it takes a more relaxed approach toward privacy than many other jurisdictions.

“Our legal framework and regulatory environment – which raise fewer privacy concerns – make it easier to generate a huge amount of data and thus provide an unparalleled testing bed,” Sheng said.

One uniquely Chinese source of information for banks is the government-administered social credit system, which is being tested in cities across the country as a way to reward good deeds and punish misbehaviour.

In one potential scenario cited by MYbank President Jin Xiaolong in a recent interview, a small-business owner whose social credit score dropped because he failed to return a borrowed umbrella would find it harder to get a loan.

But the biggest data trove may come from payments providers like the one operated by Ma’s Ant Financial, the biggest shareholder of MYbank. After obtaining authorisation from borrowers, MYbank analyses real-time transactions to gain insights into creditworthiness. For example, a drop in customer payments at a retailer’s flagship store might be an early indicator that the company’s prospects – and its ability to repay debt – are deteriorating.

The upshot of more information is a loan approval rate at MYbank that’s four times higher than at traditional lenders, which typically reject 80 per cent of small-business loan requests and take at least 30 days to process applications, according to Jin, who plans to double MYbank’s roster of borrowers in three years. He said the Hangzhou-based firm’s operating cost per loan is about 3 yuan, versus 2,000 yuan at traditional rivals.

MYbank, which earned 670 million yuan last year, is far from the only lender using technology to boost small-business lending. Units of Tencent Holdings and Ping An Insurance Group both have similar offerings, while state-owned China Construction Bank is dramatically ramping up its presence in the space.

The nation’s second-largest lender unveiled a mobile app in September that can process loan applications for as much as 5 million yuan in two minutes. Construction Bank boosted its small-business lending by 51 per cent last year, more than twice as fast as the industry. The bank charges an average interest rate of 5.3 per cent for one-year loans, slightly above the 4.35 per cent benchmark lending rate, and says defaults have held at a minuscule 0.3 per cent.

“It’s a profitable business as long as you can keep the risks in check,” said Zhang Gengsheng, a vice-president at Construction Bank in Beijing. “We had suffered huge losses in the past with a bad-loan ratio running at 8 per cent. But now we’re back in the game.”

While keeping defaults in check may prove more difficult as China’s economy slows, all signs point toward continued growth in small-business lending. In February, the banking regulator called on state-owned lenders to boost credit to small companies by at least 30 per cent this year. About two-thirds of the country’s 80 million small businesses lacked access to loans as of 2018, according to China’s National Institution for Finance & Development.

For Zeng Ping’en, who runs a scooter store in Hangzhou with about 1.2 million yuan in annual sales, MYbank’s lending app has been a game changer. After allowing the bank to access his store’s transaction data, Zeng has been able to take out small loans to cover short-term cash needs. He pays an annualised interest rate of about 15 per cent.

“It was unimaginable a few years ago, when no bank would approve my request,” Zeng said. “Now I can borrow whenever I need to.”

 

[JSCh]

China's SME fintech adoption rate leads the world: EY report
Source: Xinhua| 2019-07-29 19:39:35|Editor: huaxia


BEIJING, July 29 (Xinhua) -- The adoption rate of fintech in China's small- and medium-sized enterprises (SMEs) ranked first in the world, according to the report, Global FinTech Adoption Index 2019, released by Ernst & Young Global Limited (EY).

The adoption rate of fintech in China's SMEs reached 61 percent, while that in the United States came in second at 23 percent.

SMEs in emerging markets are particularly heavy users of banking and payment services, with 63 percent using services in that category. In China, the rate is 92 percent.

As for consumers' use of fintech, the consumer fintech adoption rate in both China and India reached 87 percent, far ahead of the global average of 64 percent, which indicates the wide application of financial platforms and ecosystems in China.

Money transfer and payment is the most common category. In China, where money transfer and payment apps are pervasive, the adoption rate is 95 percent.

The report was based on online surveys of more than 27,000 consumers in 27 countries and regions and 1,000 SMEs in the United States, UK, China, Mexico and South Africa.

 

[JSCh]

SEPTEMBER 3, 2019 / 12:42 AM / UPDATED 17 HOURS AGO
HSBC processes first blockchain letter of credit using Chinese yuan - Reuters
Alun John

HONG KONG (Reuters) - HSBC completed the first yuan-denominated blockchain-based letter of credit transaction, the bank said on Tuesday.

HSBC, like many of its competitors, has been looking to use digital ledger technology, or blockchain, to streamline the traditionally paper-based and bureaucratic business of financing trade.

As the first such transaction to use the Chinese currency, this deal marks a step forward in the use of the Voltron trade finance platform, developed by eight banks including BNP Paribas, and Standard Chartered as well as HSBC.

So far transactions using the platform have primarily been individual pilot cases, but Ajay Sharma, HSBC’s regional head of global trade and receivables finance for Asia-Pacific, said that progress was being made toward a full proposition, and what could be a commercially acceptable model for banks.

“We are hoping that we will have something by end of the year, maybe the first quarter of next year, where will we know from Voltron what it costs, at which point, a lot of banks who might be sitting on the sidelines will be able to make a decision,” he said.

“Clearly we are hoping that through this technology, the unit cost of doing a transaction comes down, along with other benefits, such as speed.”

HSBC said, citing SWIFT data, that 1.2 million letters of credit, documents issued by a bank guaranteeing a buyer’s payment to a seller, worth US$750 billion were issued into and out of China alone in 2018.

This particular deal involved Hong Kong-based MTC Electronic exporting a shipment of LCD parts and panels to its parent company, Shenzhen MTC, based across the border from Hong Kong.

The exchange of the electronic documents was completed in 24 hours, compared to the typical five to 10 days for conventional document exchange, the bank said.

Reporting by Alun John

 

[JSCh]

China's digital currency may be world's first: newspaper
Source: Xinhua| 2019-09-04 13:04:11|Editor: Liu

BEIJING, Sept. 4 (Xinhua) -- China may issue the world's first central bank digital currency (CBDC), China Daily reported Wednesday.

The to-be-unveiled currency could be put into electronic wallets to support direct and peer-to-peer transactions. The "wallet" could be an app on a smartphone, but the final design has not yet been settled, the newspaper reported, citing Mu Changchun, deputy director of the central bank's payments department.

The CBDC, a new form of money issued digitally by the central bank and serves as legal tender, is backed by the reserves of valuable assets that commercial institutions deposit in the central bank.

A "closed-loop testing" has already started, simulating certain payment scenarios and involving some commercial and non-government institutions, said an official from the People's Bank of China, who declined to be named.

At the initial stage, the CBDC is for domestic use only. In the future, it is designed to adopt the same exchange rate as physical money, but the cross-border transaction mechanism will be much more complicated, which requires policy coordination with other countries, the official told the newspaper.

"If China successfully issued the world's first CBDC, it will promote other countries to accelerate relevant studies and join the competition of creating CBDC," said Huang Yiping, director of the Institute of Digital Finance at Peking University.

The CBDC could be seen as residents' deposits in the central bank's account, said Peng Wensheng, global chief economist with Everbright Securities.

As PBOC officials reiterated, the CBDC will replace bank notes and coins, or the cash in circulation (M0), and it is designed for retail payments at the early stage.

 

[JSCh]

MYbank Awarded 2019 Global SME Bank of the Year | Business Wire

​

MYbank's 310 lending model empowers SMEs to survive and thrive (Photo: Business Wire)

October 08, 2019 02:35 AM Eastern Daylight Time

HANGZHOU, China--(BUSINESS WIRE)--MYbank, a leading online private commercial bank in China and an Ant Financial brand that focuses on SME (small and mid-size enterprise) financing, was yesterday named a PLATINUM winner of the Global SME Bank of the Year award category at the Global SME Finance Forum Awards for leveraging innovative digital technology to make finance accessible for tens of millions of SMEs.

“We hope the winners of the Global SME Finance Awards will inspire SME financiers all over the world to learn from their good practices. The Awards provide the winners an opportunity to showcase good practices on the global stage and foster learning amongst their peers.”

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In 2015, MYbank pioneered the “310 model” for SMEs, which has enabled financial institutions in China to leverage proprietary risk management technologies so they can provide collateral-free business loans to SMEs. Not only has it enabled access to capital for SMEs, but they can apply for a loan simply by using their mobile phone, highlighting the ease and convenience of the model. Furthermore, as the name suggests, 3-1-0 lending enables borrowers to complete their online loan applications in three minutes, obtain approval in one second and with zero human intervention.

“We are very pleased to receive the recognition from IFC and the SME Finance Forum,” commented Simon HU, Chairman of MYbank, “In the age of the digital economy, digital finance can and should be used for the good of society. Our vision is to leverage digital technology and enable our financial partners to use the ‘310’ model to empower traditional unbanked and underbanked SMEs such as roadside vendors, mom-and-pop stores, and small business operators who contribute significantly to job creation and the growth of the real economy.”

On June 21, 2018, MYbank announced Star Plan which aimed to use technology to enable 1,000 financial institution partners to provide more cost-effective financing services to 30 million SMEs in China within a three-year period. As of September 2019, the 310 model has enabled MYbank and its over 400 financial institution partners to serve at least 20 million SMEs. Leveraging proprietary risk management technologies, MYbank helps keep the non-performing loan (NPL) ratio for the SME business loans offered through the 310 model at around 1%. As of June 2019, the size of each loan provided by MYbank was around RMB 10,000 (USD 1,400), reflecting the specific needs of SMEs, many of whom are roadside vendors, mom-and-pop shops and individual business operators with no more than five employees.

Simon HU added, “As the Star Plan progresses, we look forward to increasing the inclusivity of financial services for SMEs by sharing our technologies with more financial institution partners in China and beyond.”

Organized by IFC, a member of the World Bank Group, and the SME Finance Forum and endorsed by the G20’s Global Partnership for Financial Inclusion (GPFI), the Global SME Finance Awards celebrate the outstanding achievements of financial institutions and fintech companies in delivering exceptional products and services to their SME clients.

Matthew Gamser, CEO of the SME Finance Forum said: “We hope the winners of the Global SME Finance Awards will inspire SME financiers all over the world to learn from their good practices. The Awards provide the winners an opportunity to showcase good practices on the global stage and foster learning amongst their peers.”

This year’s award winners were selected from a competitive pool of 144 applicants. A panel of independent judges chose the winners based on their Reach, Uniqueness and Innovation, Effectiveness and Impact, and Dynamism and Scalability.