China's central bank to strengthen regulation over fintech
Published: Jan 06, 2021 10:53 PM

A file photo shows a pedestrian walks past the headquarters building of the People's Bank of China in Beijing, capital of China. Photo: Xinhua

China's central bank vowed to implement new measures to further promote China's financial sector's development including strengthening regulations governing the fintech sector, releasing accurate monetary policies, and further opening up China's financial sector, according to a statement on the People's Bank of China's website.

The statement said the central bank's work over the next year will focus on 10 areas in China's financial sector including promoting the development of digital currency, improving financial services and deepening reform of the financial sector.

The central bank said it will further improve risk prevention mechanisms and strengthen regulations governing internet financial activities to prevent the disorderly expansion of capital.

The bank's statement said it "will strengthen the supervision on online payments, and crackdown on violations including excessive marketing that harm consumers' interests to make sure the innovation of fintech develops under the correct regulations." 

The banking authority needs to ensure it has effective regulations that support China's burgeoning digital economy and can keep pace with innovations happening in the e-commerce sphere, Dong Dengxin, director of the Finance and Securities Institute at the Wuhan University of Science and Technology, told the Global Times on Wednesday.

Dong said that China's e-commerce platforms have the tendency to either fall into cut-throat competition or abuse their monopolistic status by overcharging for their services.

Strengthened regulation will not harm the sector's ability to innovate, noted Dong.

Regulators also need more detailed rules to support the real economy, mitigate financial risks and protect consumer rights, Dong said.