But it is not easy to use this "double-edged sword" well. "Digital finance is an important direction for inclusive finance."
"Building a high-quality inclusive financial system is like a marathon. It requires perseverance and long-term efforts." At the last plenary session of the 2024 Lujiazui Forum, the first guest, Laszlo Vastag, Executive Director of the Hungarian National Bank, used a metaphor to point out the difficulty of inclusive finance.
So how can we keep this marathon powered by a steady stream of energy? At the forum, experts from regulatory authorities, policy banks, commercial banks, and academia all mentioned a key word: digitalization.
Qian Wenhui, Chairman of the Agricultural Development Bank of China, has a deep understanding of this. The Agricultural Development Bank has used technology and digital finance to develop a series of agricultural loan models that meet the characteristics of private small and micro enterprises, and has achieved positive results. In 2023, the Agricultural Development Bank's online inclusive small and micro loan service customers exceeded 50,000, improving the accessibility and convenience of financing for small and micro private enterprises. "Digital finance is an important direction of inclusive finance." Qian Wenhui revealed on the spot that the Agricultural Development Bank is developing a new system that will penetrate the requirements of enterprise risk management through 70 dimensions of different information.
Pan Jun, professor of finance and chairman of the professorial committee at Shanghai Advanced Institute of Finance, Shanghai Jiao Tong University, also believes that digital technology is a "sharp sword" that inclusive finance can use. In her research, she found that in remote areas where the coverage of traditional financial institutions is relatively low, the role of financial technology in promoting is particularly obvious. "This shows that for individual investors in remote areas, due to the absence of traditional financial institutions, their investment potential has not been fully met, and financial technology platforms can make up for this absence." Pan Jun said.
The edge of this "sword" is the use of data. Ren Deqi, chairman of Bank of Communications, said that in the past financial model, banks looked at mortgage guarantees, while inclusive customers often lacked qualified collateral. To overcome this problem, the key is to integrate internal and external information, accurately profile customers based on their business behavior and credit data, and actively grant credit. "Strengthening data empowerment will increase the availability of financing." Ren Deqi introduced that in recent years, the credit growth of Bank of Communications' inclusive finance has exceeded 30%, and the core is in the field of data empowerment.
So where does the data come from? Liao Yijian, co-chief executive of The Hongkong and Shanghai Banking Corporation Limited, believes that it is necessary to promote the sharing of credit information to solve the problem of information asymmetry among SMEs. In his opinion, unlike large enterprises, the financial management of SMEs urgently needs to be standardized, which makes it difficult for banks to fully understand the real operating conditions and financial results of enterprises, as well as their credit status. He believes that if the information barriers between various government departments, financial institutions and communication operators can be broken down, it will help banks obtain data from third-party institutions such as credit investigation, taxation, government affairs, customs, and justice, so as to grasp the operating conditions and business prospects of SMEs and meet the requirements of risk control.
However, whether using data or digital means, while bringing convenience, it also increases risks. Therefore, how to control the risks brought by new technologies has become a hot topic discussed by the guests.
Richard Cantor, global vice chairman of Moody's Ratings, believes that regulators and regulatory methods need to keep pace with the times. "Regulatory methods must also be transparent and fair. The original digital field lacked regulation and was not transparent enough. Now market institutions must adopt new risk control measures to limit the spread of risks in AI financial services consulting."
As a representative of the regulatory agency, Laszlo Vastag, Executive Director of the Hungarian National Bank, made suggestions from two aspects. The first is to attach importance to financial education. He shared some of Hungary's experiences, such as establishing a nationwide network of financial consultants with non-profit organizations so that people can get consulting services before making financial decisions.
Secondly, the regulatory environment must ensure fair competition. Laszlo Vastag said: "Those traditional banks are working hard to speed up the pace of digitalization, and there are also some emerging players that have entered the market late. We must allow them to be in an equal competitive environment with those more advanced players."
