China central bank issues guidelines on internet finance development

China central bank issues guidelines on internet finance development

BEIJING (Reuters) – China's central bank on Saturday issued guidelines promoting the development of internet finance, saying it would support "qualified" financial institutions to set up platforms for online banking, insurance & securities businesses.

It added it would encourage high-performing & qualified internet finance firms to list.

A senior central bank researcher said last month that regulators should set up clear rules allowing banks to set up online finance subsidiaries to fend off rising competition from technology giants that have expanded into their territory.

p> "In recent years, China has seen rapid development in internet finance, yet some problems & hidden risks have moreover cropped up," an official with the People's Bank of China, the central bank, said in a statement.

Fund security, operating risks, an imperfect credit system & consumer protections were among the issues, said the official.

The central bank called on the government to support internet firms in setting up platforms for expenditures & loans, crowdfunding, the sale of financial products & other financing platforms.

It called for broadening channels of financing & supporting private investment funds to back the internet finance industry.

The bank moreover recommended tax breaks for qualifying small enterprises including start-ups, saying that provincial level governments should increase their support for those companies.

Alibaba Group Holding Ltd said in April its finance affiliate sped up a drive to be a fully-fledged online financing network by launching an e-commerce tracking stock index. It launched an internet bank targeting small & medium enterprises last month.

(Reporting By Xiaoyi Shao & Megha Rajagopalan; Editing by Michael Perry)

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Source: “Reuters”

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