Ten years from now, business historians will offer a number of reasons financial services had changed so radically since 2016, from general advances in technology to the regulatory reaction to the crash of 2008. But one factor appears likely to stand out above all the others: the blockchain, a distributed database that serves as the backend of the virtual currency Bitcoin. Today, financial services are investing billions in blockchain technology. Many believe it will lead to a radical simplification of banking and payment systems everywhere—a world where money and other assets take nanoseconds to transfer, cannot be lost or stolen, and require no intermediaries to process.
For consumers in mature markets, the financial technology boom doesn’t seem very exciting. What they’ve seen so far is technology that shaves a few minutes off an efficient process, such as being able to deposit a check by taking a picture of it instead of going to the ATM. But for parts of the world where people still buy and sell things with banknotes, the FinTech boom is likely to be a major event with important economic consequences.
From the crash of 1929 to around 1981, banking was generally considered a fairly dreary business. And between now and 2025, banking seems likely to undergo a digitally driven transformation that will change how we save, spend, borrow and invest. Even as regulators do their best to try to make banking a boring business again, and politicians still vow to rein in the “banksters”, a number of well-financed start-ups look poised to reinvent almost every aspect of finance—and could even make banking sexy once more. First we look at how regulators’ push and FinTech’s pull may be setting the stage for some dramatic changes.
To boost the economy and help small and medium enterprises get capital more easily, the Chinese government is encouraging non-government entities to invest in financial institutions, even allowing private companies to open their own banks. When the government announced its decision to grant five banking licenses for private banks earlier this year, the big three tech companies—Tencent, Alibaba and Baidu—jumped at the opportunity. Given the technological expertise of their backers, these online banks are able to leverage things like big data and cloud computing to assess credit worthiness and tailor the user experience. But can they outmaneuver traditional banks?
The China-led Asian Infrastructure Investment Bank is poised to reshape development in Asia, and international finance.
CKGSB’s Business Sentiment Index shows that China’s industrial economy hasn’t improved over the last quarter. Rather it has contracted slightly.
PBOC’s move to devaluing the RMB didn’t just follow weak exports data, but also IMF requirements for more market-driven exchange rates.
Is the yuan devaluation the start of a currency war, or a reflection of Beijing’s plan to give the market more power?
Early indications show that the Chinese government’s efforts to prop up the economy might be able to steer clear of the risks of the 2009 economic stimulus
In a short space of time Alibaba’s Ant Financial has created—and scaled—a diverse set of financial products and services: from online payments to cloud computing and data services.