Fan Wenzhong: The Future of Fintech and the Opportunities for the Capital City of Beijing

On August 5, 2021 Shell Finance Summer Online Summit "Digital Economy: The Road to the Future" kicked off, and Fan Wenzhong, Secretary of the Party Committee and Chairman of the Board of Directors of Beijing Financial Holding Group (BFHG), attended the forum and delivered a keynote speech titled "The Future of Fintech and Opportunities for the Capital City of Beijing". "The following is the full text of the speech:

The future of financial technology and the opportunities for the capital city of Beijing. The following is the full text of the speech:

In today's world, a new round of information technology revolution has emerged, profoundly affecting the global economic and political development pattern, and various industries are experiencing brand-new changes, and the rapid innovation of financial technology has ignited a new spark of global financial competition.

Currently, we are in an era of financial leapfrogging, where the asset size, number of branches, and business market share of financial institutions are no longer guaranteed factors of success. Insight into the future trend changes, as well as the ability to grasp this trend is the fundamental survival and development of the enterprise. In fact, there is no difference between the core competitiveness of a financial institution and an Internet company or a manufacturing company, which is to have the ability to outperform competitors in terms of customer acquisition, the ability to understand customers more y, and the ability to provide customers with the products and services they need in a timely and comprehensive manner. To put it plainly, the business logic of selling cabbages and wealth management is essentially the same, except that the latter requires a financial license.

For a country or region, the degree of sophistication of the financial technology infrastructure will be the core competitiveness of the future. Just as the ability to build high-speed rail and highways has driven China's miraculous growth for more than four decades since its reform and opening up. Now that data serves as a core economic resource, platforms for collecting, processing, and applying data have become infrastructure, and the degree of sophistication of these financial technology infrastructures will determine the core competitiveness of countries and regions.

If China is to build a fintech infrastructure that is fit for the future, it must answer the fundamental questions of who plans, who builds, who operates, and who applies.

Theoretically, infrastructure planning needs to be forward-looking, comprehensive, fair and authoritative, and all social infrastructures should be designed at the top, and fintech infrastructures are no exception to this rule, and need to be planned and designed in a unified manner. The government has the most comprehensive information about the development of social planning, and should set up a "planning bureau" to adapt to the development of the digital economy, conduct comprehensive planning for regional and national infrastructure, balance the interests of all parties in society, and formulate a fair and equitable plan for the distribution and use of data resources, so that the financial infrastructure from the beginning of the planning to have the right direction.

The government can't do everything when it comes to building infrastructure. Just like building bridges and roads, the state can't both produce cement and steel and organize construction teams. To clarify the boundaries between government and market responsibilities, and to efficiently promote the construction of financial technology infrastructure, it is necessary to attract the active participation of specialized, market-oriented institutions. The construction process should be open-minded and "specialize in different fields", and should bring together the resources and technologies of all parties. At the policy level, the government should formulate construction standards and use norms, and be the "supervisor" and "acceptor" of the project; at the implementation level, it should make full use of the professional experience and excellent talents of various market organizations and science and technology enterprises, so as to build the "roads" and "roads" in the financial sector in a fast and good way. The "roads" and "bridges".

Two thousand years ago, Qi's Guan Zi had pointed out in the "extravagant chapter" to the point, "cheap has real, respect is useless, then people can be punished". The meaning is that really important daily necessities, such as grain, flour, cloth and silk, must be inexpensive, whereas some flashy and useless luxuries, such as jade and gold, can be expensive, and if not, society will have big problems. By the same token, data and information, which have now become the core economic resources of society, must be kept inexpensive in order to reduce the economic operating costs of society as a whole. The infrastructure of society cannot be privately owned by individual enterprises, nor should it be aimed at increasing the profits and shareholders' returns of individual platforms. If platform enterprises are allowed to monopolize the price of data, it will lead to a reduction in the economic efficiency of society as a whole and a decline in the overall welfare of society. As early as the Spring and Autumn Period, Guan Zhong advocated that the government should set up a "governmental Shanhai" or other specialized organization to directly manage special industries such as salt and iron. Similarly, as a platform for managing the core economic resources of society, the financial and technological infrastructure has both economic and social attributes, and should be managed by organizations with credibility and public interest, or operated in a "government + market" manner, so as to reduce the social cost of data and information and eliminate the "black box of data". "

The vertical view of the data is a good one.

Throughout history, technological revolutions have often helped the poor and the weak. After the agrarian revolution, the previously disadvantaged mental laborers realized a reversal of the hunting and predatory manual laborers; after the industrial revolution, the white-collar workers with core scientific and technological expertise realized the surpassing of the blue-collar workers with traditional manual skills; and after the information revolution, the disadvantaged groups of the original financial services - micro, small, and medium-sized enterprises and the general public - will be the main targets of financial and technological innovations. After the information revolution, the previously disadvantaged groups in financial services - micro, small and medium-sized enterprises (MSMEs) and the general public - will be the main beneficiaries of fintech innovation and fintech infrastructure development. This is like a city's public **** transportation and water, electricity and gas facilities, where the government coordinates the planning, commercial companies participate in the construction, and public interest enterprises are entrusted to operate the facilities, which are ultimately used by the general public **** enjoyment.

As a national center for science and technology innovation and a national financial management center, Beijing has many unique advantages in developing the digital economy.

The first advantage is a strong financial position. As a national financial management center, Beijing is home to national financial management departments, large financial institutions, important financial infrastructure, and international financial organizations. According to relevant statistics, Beijing has more than 170 trillion yuan of financial assets, more than half of the national financial assets, licensed financial institutions more than 900 legal entities, ranking first in the country. The second advantage is the superiority of technology.
As an international science and technology innovation center, Beijing is one of the most concentrated cities in the country and the world in terms of science and technology innovation resources, and has been ranked first in the world's scientific research cities for three consecutive years; the intensity of the city's R&D investment has remained at about 6%, exceeding that of New York, Berlin and other internationally renowned cities of innovation; and the cumulative number of national scientific and technological awards has accounted for 30% of the country's total. The third advantage is that there is a lot of talent.


Beijing's Research Institutes and Educational Institutions, 50 percent of the country's academicians, nearly 1 million students and faculty members, elite talent across all sectors, and a large number of the country's major, key research projects and industrialization projects. The fourth advantage is a good foundation.
In recent years, the Beijing Municipality, under the impetus of the Big Data Action Plan and the "1 3" policy system to promote the innovative development of the digital economy, has completed the convergence of the city's government data, and the service capacity has been strengthened, and the innovative application of the highlights appear frequently.