January 30, 2018, Shanghai – Since last year, more and more regulations from the Chinese government have made lots of companies in internet finance quite difficult in development, but also brings opportunities for some tech-driven companies in financial services, said Co-founder and Vice President of VFinance Dr. Rhea Liu at the panel discussion of 2018 International Youth Leadership Finance Summit (IYLFS), which was held on January 28 in Shanghai by Shanghai Advanced Institute of Finance (SAIF). 

In recent years, the Fintech development in China is very fast, and is even ahead of many developed countries. “One factor is that the traditional financial service industry doesn’t have a complete coverage of many areas, and it doesn’t provide good services for many people. Another factor is that the government is in favor of Fintech development in the early stage,” said Prof. Chun Chang, Executive Dean and Professor of Finance at SAIF, in his keynote speech at 2018 IYLFS. 

Good combination of finance and technology can help companies grow and achieve more in business development. However, financial risk also exists and cases of financial fraud are often to be seen in the past few years, especially in P2P (Person-to-Person) area. That’s why the government has implemented more and more regulations since last year to intentionally control the financial risk in Fintech development. In terms of such severe rectification, many illegal businesses were banned or were forced to transform themselves into businesses that are in more compliance with regulations. 

Co-Founder and Vice President of VFinance Dr. Rhea Liu Speaks at 2018 IYLFS

“If Fintech companies are able to understand the essence of each regulation, and can also take regulatory factors into consideration during the stage of product design and development, then they will have more competitive advantages than others,” said Dr. Rhea Liu at the panel discussion of 2018 IYLFS. She also mentioned that Fintech companies that proactively embrace regulations can help facilitate the sustainable development of Fintech industry. As a leading Fintech company, VFinance is dedicated to providing internet finance infrastructure products and technical solutions to corporate clients in different industries, and help them conform to regulatory requirements. “On the other hand, regulation itself should advance with the times, and can measure Fintech companies from different dimensions and levels through more technical approaches,” Dr. Liu stated as well. 

In order to make Fintech development more normative and healthy in China, it’s a trend that more and more regulations will be formulated and implemented. But if a company can make good use of this “two-edged sword”, it will stand out from its peers and grow into a more sustainable and successful business.