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On-line Banking Enjoys Great Prospects in China
Chinese and overseas experts attending the Global Internet Financial Services Conference opened in Beijing Tuesday said that China's on-line banking business is facing great development opportunities and has enormous potential.
The conference, jointly sponsored by the China Development Bank (CDB) and the United States' Lehman Brothers, attracted nearly 100 Chinese and overseas financial and IT experts. They discussed the global on-line banking developments, present and future prospects of on-line banking businesses in China, and exchanged views on various related issues.
Jarett Wait, chief executive officer of Lehman Brothers Asia, said that China has been a pioneer in the Asian on-line financial services sector and has made great progress in this area. China is in a unique position to accelerate its economic growth by continuing to embrace the Internet and the technology revolution.
He said that China can benefit from the experience of the US and Europe, as well as benefit from examining the developments in the marketplaces of some Asian neighbors such as Japan and the Republic of Korea. Internet users in China have exceeded 10 million, providing a potentially huge market for on-line financial services.
"By 2003, there will be over one million users of on-line brokerage services in China, accounting for over five percent of the total trading volume with an annual growth rate of over 230 percent," he said.
Governor of CDB Chen Yuan said that as China makes significant progress in WTO membership negotiations, full-scale competition from foreign banks are also imminent. China's banks face both encouraging opportunities and tough challenges.
"On-line banking is a critical part of e-commerce," he said. "The financial sector plays a pivotal role in the Chinese economy, therefore, it is also in a best position to impose an impact on the process and level of e-commerce application in other sectors. Banks should become the most active participants and promoters of e-commerce."
He said that China's banks have placed increasingly greater emphasis on the construction of electronic banking and most major commercial banks have recently opened on-line banking services.
However, China's on-line banking business is still at a primary stage, he said, adding that existing on-line services are basically the extension of traditional businesses, while banks still lack new services that can coexist with the Internet. As a result, China's banking industry should draw on the experiences of developed countries in e-commerce development.
Chen Jing, director of payment and IT department of the People's Bank of China, said that the central bank has played an important role in the country's development of e-commerce. Since the beginning of 1998, the Bank has worked out a number of tasks, including establishing a financial certification center, a study group on the role of the central bank in e-commerce and a liaison and study group on e-commerce in the financial industry.
He said that the central bank plans to establish a financial certification policy management committee, build financial certification management, set up a study group on on-line banking, establish guidelines on on-line banking licensing and supervision procedures, a study group on on-line payment and solve problems on the on-line payment system.
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