The latest technological developments have deeply transformed our everyday lives, from converting our houses into smart homes and putting autonomous cars on the streets, to revolutionizing a wide array of services - including the financial sector. China seems to be leading the way in recent years, by undergoing an impressive digital transformation that has produced a booming fintech industry.

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Chinese Enterprises Branch out into Growing Fintech Market

China is home to some of the biggest innovators in fintech worldwide, such as Tencent, the Chinese holding conglomerate that started off in 1998 in the telecom industry and soon expanded into several other sectors, including fintech, generating immense brand value. The latest prodigy of the e-commerce ecosystem, Alibaba, is another prime example of a success story. By starting out in online retail, Alibaba has then branched out into the digital payments industry and then over to financial services and wealth management, focusing on B2B services. Now roughly 870 million active users have embraced its online and mobile payment tool, Alipay, which unpacks into 600 million Chinese users and 270 million living outside of China, as CNBC reports.

 mobile payment tool
(Photo : pexels) mobile payment tool

Chinese Consumers Lead in Fintech Services Adoption

According to a survey reported by the same source, in which EY reviewed fintech adoption in 20 of the world's biggest economies, almost 70% of Chinese consumers had turned to two or more fintech services during the last six months. By contrast, the same figure was 52% for India and 42% for the UK. The most popular fintech sub-industry in China are platforms for mobile payments and transferring money, serving 83% of consumers in the country. Another 58% stated that they turn to fintech for managing their savings and making investments, while 46% have used fintech to get a loan. With a wide range of consumers turning to finetch for convenience and to cut back on costs, the industry has widely developed in recent years, creating jobs and boosting China's innovation exports. In fact, China has seen the fastest fintech transformation in the world in the last ten years. In Q1 of 2018, more than $1 billion was poured into the Chinese fintech industry among ten deals. Since 2014, the country has seen over $20 billion in funding invested in fintech companies, with many investors turning to China amidst turmoil in European and US markets, which has positively influenced the Chinese economy.

Infographic: FinTech Adoption Rates | Statista You will find more infographics at Statista

Fintech Companies Need to Focus on Cybersecurity to Protect Sensitive Financial Data

Innovation breeds innovation, as cutting-edge tech may offer solutions to long-standing problems and streamlines access to service, but it also creates new risks. With the advancing digitization of financial services, online threats like data theft and identity fraud become all the more pertinent, which contributes to a growing need for more and better cybersecurity with tools like a WAF assuming a crucial role for cloud-based businesses. A web application firewall can help protect web applications on the cloud from hacker attacks by filtering out malicious traffic and preventing cyber-criminals from stealing sensitive data like banking and credit card information. Offering relevant training to employees so that they can spot and address vulnerabilities is another top priority for up-and-coming fintech startups.

More and more businesses that are migrating to the cloud and digitizing their services are beginning to understand the importance of developing a comprehensive IT and cybersecurity internal policy. This is extremely important for smaller enterprises that do not possess the extensive background and resources of giants like Tencent.