The rapid development of financial technology (FinTech) is gradually changing the global financial landscape, and China is at the forefront of this digital revolution. With its excellent information technology infrastructure, vibrant FinTech ecosystem and rich FinTech application scenarios, China is providing a strong impetus for the advancement and transformation of financial services.
Regulatory Organizations and Institutions in China
In recent years, Chinese organizations and departments at all levels have deployed the regulation of financial activities, requiring that all types of financial activities be brought under supervision in accordance with the law. In order to solve the long-standing outstanding contradictions and problems in the financial sector, on March 7, 2023, the State Council’s institutional reform plan was announced at the first meeting of the 14th National People’s Congress.
Relevant reading:
Fintech Insights
Achieving success in China’s thriving FinTech landscape goes beyond innovation alone—it necessitates effective communication and strategic PR.
Financial Technology Development Plan and Priorities
The Financial Technology Development Plan (2022-2025) (hereinafter referred to as the Plan) issued by the People’s Bank of China (PBOC) puts forward guidelines for the development of financial technology in the new era, and clarifies the overall idea, development goals, key tasks and implementation guarantees for financial digital transformation. It also means that under regulation, FinTech further emphasizes technological innovation and development, and activates a new generation of financial services with the power of science and technology. The Plan aims to promote China’s FinTech sector to a new level by 2025, and to enhance the overall level and core competitiveness.
China FinTech Association, Hub, and Global FinTech Associations
China FinTech’s touchpoints with associations
- CNAPS: China National Advanced Payment System, which provides interbank payment and settlement services for commercial banks as part of the World Bank’s technical assistance loan project.
- China Clearing Organization: China Payment and Clearing Association is a self-regulatory organization of China’s payment and clearing service industry.
- China UnionPay: With the approval of the State Council and the approval of the People’s Bank of China, on the basis of merging 18 bank card information exchange centers, 85 institutions jointly funded and established the China Bank Card Federation, headquartered in Shanghai.
- China Cross-border Payment System: CIPS, supervised by the People’s Bank of China, is a wholesale payment system specializing in RMB cross-border payment and clearing services.
Key hubs for FinTech in China
- Beijing: The seat of the Chinese central government, Beijing is home to numerous well-known FinTech enterprises and startups, including Xiaomi Finance, UnionPay QuickPass, PayPal, and more.
- Shanghai: China’s economic and financial hub, and one of the international financial centers. It boasts abundant financial resources and a pool of technical talents. Many renowned domestic and international FinTech companies and institutions opt to establish branches or headquarters in Shanghai. Notable Chinese FinTech enterprises such as Ant Group, Lufax, Visa, and others.
- Shenzhen: China’s tech and innovation hub, with a continuously growing number of FinTech companies. Many startups also choose Shenzhen as their base of operations. Renowned domestic FinTech enterprises like Tencent Financial Technology and Huawei Financial Technology are based here.
- Hong Kong: Pioneering in digital payments in China and one of the international financial centers, Hong Kong features stable financial infrastructure and a relatively comprehensive regulatory framework. The FinTech innovation ecosystem is vibrant, encompassing payments, digital banking, blockchain, artificial intelligence, and more. The regulatory environment is relatively open, with a strong emphasis on compliance and regulation. In recent years, numerous digital financial pilot projects have originated here, and many startups and tech companies engage in entrepreneurial activities in this city.
Other Associations
Global FinTech Associations
- SWIFT: Society for Worldwide Interbank Financial Telecommunication, providing secure and standardized communication services for bank settlements.
- CHAPS: The “Automated Clearing and Payment System” created by the Bank of England in London, one of the world’s largest large-value real-time settlement systems, and a real-time gross settlement system for UK sterling transactions.
- CHIPS: Operated by the New York Clearing House Association (NYCHA), one of the world’s largest privately owned payment clearing systems, primarily clearing cross-border U.S. dollar transactions.
- EMVco: A professional organization that develops and maintains international payment standards, initially developed in partnership with Europay, Mastercard, and Visa, and later joined by other banks, payment institutions, and card brands such as American Express, JCB, and China UnionPay.
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China’s FinTech regulatory system and diverse organizational ecosystem are driving financial sector breakthroughs. To enter the Chinese market, foreign companies must familiarize themselves with the regulatory environment and understand China’s FinTech regulations and compliance requirements. At Influence Matters, a leading marketing and PR firm specializing in assisting overseas companies entering China, we provide comprehensive solutions dedicated to ensuring our clients’ success in the Chinese market. In the forthcoming article, we will extensively examine the regulatory landscape of the Chinese market, shedding light on the intricacies that international companies encounter while operating in the FinTech industry.
Moreover, we are thrilled to inform you that we have scheduled the release of “The Fintech Landscape” on September 25th. For more comprehensive details, please refer to the report. By acquiring a profound understanding of the regulatory framework and key stakeholders, international companies can strategically position themselves for triumph and leverage the immense opportunities presented by China’s dynamic FinTech sector.
