At the just-concluded 2019 Boao Forum for Asia, Li Dongrong, President of the National Internet Finance Association of China, said that financial institutions should seize the opportunity brought by the development of information technology to enhance the level of digitization and datamation, improve the efficiency and ability of financial sectors serving the real economy, and promote the development of digital financial inclusion.
In his interview, NCF CEO SHENG Jia said that while the internet is widely used to improve the service experience, the efficiency and effectiveness of protecting the legitimate rights and interests of investors should be improved by technology. As a technological means broadly used in various links such as risk control audit, asset pricing, and post-loan tracking, financial technology will help improve the efficiency of risk control and better protect the rights and interests of investors.
Intelligent technology enhances the efficiency of risk control
Recent years have witnessed a surging trend toward financial technology. Overseas listed internet financial companies, internet giants such as Baidu, Alibaba and Tencent, traditional banks, and payment enterprises have accelerated their efforts in developing financial technology.
The latest data from Accenture’s survey shows that global investment in financial technology reached $55.3 billion, an increase of over two times that of 2017. China’s transactions in financial technology reached $25.5 billion, a nine-fold increase compared with the previous year. Since the beginning of this year, a series of preferential policies in financial technology have been introduced. After the announcement of making financial sectors serve the real economy, the financial innovation has been strengthened and the demands for financial regulation on the increase. The financial technology market is expected to maintain strong growth. In fact, some leading financial technology enterprises have already taken preemptive actions to seize market opportunities.
NCF is one of the pioneers of financial technology. As an open financial technology platform, NCF began to actively explore multiple financial technology fields such as big data application in risk control, scenario-based empowerment, intelligent investment, and AI identification as early as 2013. It has been committed to building a more open ecosystem and upgrading financial services with technology, exporting financial technology, establishing online user portals for both financial and non-financial institutions, and providing users with one-stop integrated financial information services.
“NCF strives to enhance the efficiency of financial services and protect investors’ rights and interests to the largest extent through the R&D and application of various scientific and technological means.” SHENG Jia said that in the field of blockchain, NCF has established a decentralized, safe, reliable and efficient platform to facilitate asset registration, transfer, financing and cashing; in the field of artificial intelligence, NCF has made an AI engine for sales forecasting, anti-fraud, post-loan monitoring, etc.; in the field of big data, NCF has built a data system covering all the business scenarios such as corporate capital, inventory management, commodity sales, and marketing.
It is worth mentioning that the intelligent risk control system “Tianyuan” independently developed by NCF can make automatic audit and gradually build a complete risk control AI system. The WAF firewall, IDS, IPS, loophole scanner and other measures deployed on the platform can also achieve high-intensity data encryption, safe storage and transmission, and safeguard user information privacy. In addition, NCF has passed the certification of National Information System Security Level 3 of Ministry of Public Security ".
Protect users’ rights to be informed, and adhere to serving the real economy
“Practitioners shall take the responsibility of meeting people’s growing needs for a better life. When evaluating innovation value, they shall consider the following standards: whether the innovation is conducive to enhancing the efficiency and inclusiveness of serving the real economy; whether it can improve financial risk management and control; whether it can strengthen the protection of financial consumers.” Li Dongrong once pointed out in public that the deep integration of financial technology, modern finance and technological innovation must always focus on serving the real economy, so as to promote the transformation and upgrading of the financial industry and build an inclusive financial system.
In SHENG Jia’s view, since investors’ knowledge about risk and financial products is limited, their investment behavior relies on the credit of institutions. To effectively protect consumer rights, they should start from compliance and make steady operation, safeguarding the interests of lenders.
For this end, NCF regularly evaluates investors’ risk tolerance through “risk assessment” and other methods, and provides them with matching products and lending services accordingly. SHENG Jia said that risk assessment is the most basic means in helping investors learn about the industry and the risks.
“Meanwhile, it’s imperative to provide complete information disclosure and risk warning, so as to make investors aware of the key links in the investment.” SHENG Jia stressed that the platform should be able to improve service efficiency and user experience while keeping users informed.
It is understood that as a member of the National Internet Finance Association of China, NCF Inclusive Finance has been among the first batch to join the “Internet Finance Registration Disclosure Service Platform” established by the National Internet Finance Association of China, and formed a complete internal information disclosure system and special column. By docking the supervision system and industry self-regulatory organization system, a three-dimensional data transmission system of real-time docking in the form of daily, monthly, semi-annual, and annual reports is established to ensure that the information is open, transparent, and traceable. It is subject to government supervision, and public oversight on the basis of protecting users’ right to be informed.
Actively participate in the establishment of the credit system
For a long time, the incomplete credit system and inaccessible credit investigation system have imposed certain limitations on the development of the financial technology industry.
“The incomplete credit system leaves loopholes for some people to make credit defaults or even maliciously escape and revoke debts in different credit investigations. This has always been a hidden problem in the development of the industry.” SHENG Jia said that the information sharing mechanism and complete credit system in the industry are effective ways to avoid and prevent the spread of risks, and eliminate risks of the same kind.
For this end, NCF Inclusive Finance has actively participated in the establishment of the industry credit data platform. In September 2016, the National Internet Finance Association of China launched the “Credit Information Sharing Platform”, and NCF Inclusive Finance was included among the first batch to have joined the platform. In August 2018, it signed the Joint Statement of Beijing P2P Industry on Establishing the Social Credit System, and joined the Social Credit System Alliance initiated by the Beijing Internet Finance Industry Association. It has promoted the establishment of a data sharing mechanism through the Internet Financial Asset Management Alliance, and focused on cracking down maliciously escaping and revoking debts. In January 2019, NCF Inclusive Finance officially signed a contract to access the judicial data query system, and tried to use this system to constrain and deter borrowers who maliciously escape and revoke debts, and severely punish the illegal act of those with poor credit.
On February 2, 2019, the Beijing Internet Finance Industry Association released the Notice on Publicizing the List of Borrowers and Institutions of Beijing P2P Industry Institutions That Maliciously Escape and Revoke Debts through its official website. NCF Inclusive Finance made a positive response and submitted the member list twice, with a view to facilitating the healthy and orderly development of P2P industry.
At present, the Beijing Internet Finance Industry Association has established a data entry system for those who maliciously escape and revoke debts together with Baihang Credit. The system is expected to be put into use in the second half of 2019. SHENG Jia said that NCF Inclusive Finance will actively participate in the efforts to improve the industry credit system and to better serve investors.
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