BEIJING, July 5, 2016 — The concept of “FinTech” has prevailed in China in recent years. As competition in internet finance gets increasingly fierce, various new technologies, such as internet payment, e-currency, internet loans, block chains, big data, cloud computing, and smart investment consultancy have changed the traditional forms of the financial service business. These new technologies are constantly giving birth to new products and new models. The era of internet finance integration and evolution is drawing near.
The Silicon Valley station of ” ‘Fire Eyes’ 2016 Sino-US FinTech Venture Contest” will officially open on July 7. With years of development, 9F has not only expanded its horizons from internet finance to FinTech, but also reached every corner of the world. Setting its eyes upon the US, the country boasting the most developed FinTech, 9F expects to discover the scientific innovation program that carries the largest growth potential, so as to improve efficiency and innovate models of financial service.
Gaps between China and the US in FinTech
The traditional financial market of the US is very well developed compared with China. Having engaged in the internet process much earlier, the country enjoys more diversified products and consists of more heated competition. In terms of financial competition, the supply of finance is relatively more ample, and gaps left by the unbanked have been filled by FinTech.
On the other side, the comparatively conservative supply structure of traditional Chinese finance has prompted the concept of internet finance. For instance, the accumulated trade volume of internet loans has exceeded two trillion. However, problems keep emerging as a result of the chaotic internet finance sector which is entailed by low access threshold and lacks regulation. It is broadly believed that China’s internet finance is developing simply by making use of internet means, lagging far behind the phase where financial service transformation is driven by the comprehensive application of such emerging technologies as cloud computing, big data, and mobile internet.
The picture is dissimilar to the US where the financial sector has been fully developed. FinTech companies here mostly provide basic information support with big data and cloud computing. Moreover, by using internet and mobile devices, these companies provide customers with a strictly on-line and low-threshold service, thus being capable of meeting financial demands which have not been met by traditional financial institutions (such as smart wealth management.)
In addition, the matrix-style financial regulatory framework of the US is relatively more mature. In place are not only such traditional functional regulating bodies as the OCC, FDIC and SEC, but also newly-established post-crisis departments like the FSPB aiming to protect financial consumers. Apart from the federal-level regulation network, there is also state-level regional regulation and coordination.
A Bright Future for China’s Internet Finance
Despite the late blooming of FinTech in China, scientific innovation has been pushing internet finance forward, and the integration of scientific innovation and finance has already begun. Moreover, business volume of internet payments and loans, among other areas, is much bigger than in the US. The internet finance market in China, which comes with huge potential, still has a chance to outperform the US.
“Instead of disappearing, future internet finance will integrate and evolve,” suggests Mr. Sun Lei, founder and CEO of 9F. Mr. Sun also believes that internet finance is, in essence, the same as FinTech. The nature of finance is a two-way flow of capitals and assets, with risk pricing floating in between; both internet finance and FinTech aim at a smoother and more secure flow of capital and assets through information technology channels.
As a result, 9F is changing its mindset from its previous focus on scale competition to FinTech in order to build a technological edge. 9F launched its mobile financing incubator last year. With an open mode of “Link”, the mobile financing incubation speeder “Plus” was established. By doing so, 9F hopes to connect different vertical-sector scenarios, as well as seek outstanding cooperation partners and mobilize various advantageous resources in order to provide service for different groups with a specifically tailored technology and build a comprehensive financial ecosystem and industry chain, ultimately improving 9F’s risk resistance and technological capacity.
Based on the pilot model of the incubator, the 9F 2016 “Fire Eyes” Sino-US FinTech Venture Contest will select start-ups with the greatest innovation value among the outstanding entrepreneurs in both China and the US. By offering more funds, more effective channels, more comprehensive information, and more open ideas, 9F will provide them with the ability to grow even faster.
On July 7, the Sino-US FinTech Venture Contest US station will be unveiled in Santa Clara Valley, California, US, an area with a large number of high-tech companies. What sparks will shine between the Chinese FinTech and US FinTech? Let’s witness the event together!