‘Balanced’ regulation of fintech the way forward for China’s authorities, industry investor says

Regulation of new financial technologies, or fintech, in China should be designed to take into account the differing nature of the technology itself as well as issues of financial stability to create consumer confidence, according to a top investor in the disruptive technologies.

Anju Patwardhan, managing director of the investment arm of Chinese fintech firm CreditEase, suggested regulators design a supervisory system which is “proportionate to the amount of risks exposed to the financial stability” in tandem with the quick development of fintech.

“You can’t apply the same regulation to every bank, non-bank and fintech business,” she said in a media interview on Friday. “It is going to have some regulation because it’s positive for consumer protection. Consumers’ financial literacy is also important.”

Patwardhan, the former chief innovation officer of Standard Chartered Bank who joined CreditEase in 2016, said authorities in the UK and Singapore had taken a pro-fintech stance and balanced way of regulation.

“I would say China is starting to catch up,” she said. “Balanced regulation helps raise consumer confidence.”

China’s leadership has been encouraging a wider use of digital technologies to redraw the country’s financial landscape, with a key part of the efforts aimed at helping residents and small businesses who find it difficult to access financing from the mainstream system. Already in China 11 times more mobile payments are processed every year than in the United States.