BEIJING (XINHUA) – The long queues at automatic teller machines (ATMs) have become a rare sight as people in China are already accustomed to going out with mobile phones instead of wallets, and many can’t even remember when they withdrew cash the last time.
Rather than visiting brick-and-motor banks, people, especially the younger generation, turn to mobile phones and computers since the Internet and apps cover most banking services.
Official data showed that the number of ATMs dropped by 68,600 from the end of last year to September, while 2,790 more commercial bank outlets were shut down in the first 11 months, following the closure of more than 6,280 over the past two years.
The change at banks is just one example of the country’s efforts to churn out financial technology (fintech) innovations and boost the digital economy, when demand for contactless service mounted and new business modes flourished in the stay-at-home market amid the COVID-19 pandemic.
Despite disruptions due to COVID-19, the country’s fintech innovations continued to provide better solutions for individuals, the real economy and social development, with the support of information technology including cloud computing, big data, artificial intelligence (AI) and mobile Internet.
“As digital payment, especially mobile payment, gets popular in the country, basic financial services are generally available in all urban and rural areas,” chairman of the China Banking and Insurance Regulatory Commission (CBIRC) Guo Shuqing said at the Singapore Fintech Festival.
“The accessibility and scale of China’s mobile payment is world-leading, and real-time reception of deposits, withdrawals and remittances have been realised,” he said.
The emergence of new business modes such as livestreaming has further boosted China’s online consumption among stay-at-home customers in 2020, with retail sales over CNY8 trillion (about USD1.22 trillion) in the first three quarters, up 9.7 per cent year on year, according to the Ministry of Commerce (MOC).
New vitality has been injected into the country’s real economy through fintech innovations. Digital credit has substantially increased the availability of inclusive financing by performing intelligent risk control with big data, which reduced reliance on collateral, said Guo.
Inclusive loans to small and micro companies surged 30.5 per cent year on year to CNY14.8 trillion at the end of September, while outstanding loans to private firms rose CNY5.4 trillion from the beginning of the year, an increase of CNY1.6 trillion from the same period last year, according to the CBIRC.
Digital transformation of the financial sector has also contributed to the country’s sprint toward the goal of eradicating absolute poverty. In the first quarter, online sales of farm produce reached CNY93.68 billion, a rise of 31 per cent year on year, MOC data showed.
The pilot of digital renminbi (RMB), which realises point-to-point payment between consumers and sellers, shows China’s determination to eliminate information and financial risks in the digital economy.
The pilot, which has been launched in the cities of Shenzhen, Chengdu and Suzhou and the Xiongan New Area, is expected to expand to more areas including the Beijing-Tianjin-Hebei region, the Yangtze River Delta and the Guangdong-Hong Kong-Macao Greater Bay Area.
In October, CNY10 million of digital RMB was issued in Shenzhen as a means of payment for local citizens. Digital RMB of 20 million, which can be spent both online and offline, was distributed among consumers in Suzhou.
To optimise the pilot, the People’s Bank of China started cooperation with major e-commerce and fintech companies such as JD Digits and Didi Chuxing. By the end of August, over 6,700 pilot scenarios covering catering, transportation, shopping, household bill payment and civic services were established for digital RMB payment.