You are here
China's top banking regulator pledges 'special' oversight on fintech giants
[NEW YORK] China's top banking regulator said China plans to impose "special and innovative regulatory measures" on financial technology giants such as Jack Ma's Ant Group, to eliminate monopolistic practices and strengthen risk controls in the industry.
Advanced technologies have brought tremendous changes to the financial sector, said Guo Shuqing, chairman of the China Banking and Insurance Regulatory Commission, in an article cited by the official Shanghai Securities News.
Mr Guo said that digital currencies, cybersecurity and data protection have become new topics for financial regulators. "There's no mature experience in legal standards and risk monitoring in mobile payments or Internet borrowing and insurance for our country," he wrote, calling such financial innovations a "double-edged sword".
Mr Guo's comments reaffirmed China's determination to prevent monopoly and risks in financial infrastructure and services, following vice-chairman Liang Tao's at a recent conference. Fintech firms should be subject to the same supervision and risk management requirements as banks, Mr Liang said.
The remarks signal companies like Ant may face more regulations after the recent crackdown that derailed Ant's US$35 billion initial public offering in early November.
Mr Guo also said that a core part of the global Basel Accords is to use capital requirements to constrain a bank's lending and keep leverage in a safe range - a direct riposte to Mr Ma's harsh criticism in October. "Without adequate capital, financial services will get into trouble sooner or later," Mr Guo said.
"The regulations should cover all financial institutions, businesses, and products," Mr Guo wrote, criticising Internet loan companies that he said had violated regulations under the camouflage of "financial innovation".