No need for China to copy US model in Internet finance

NEW YORK - China can learn some experiences from the United States in managing Internet finance rather than completely copy the US model, an industry expert said.

Internet finance is in, but is banking out?

Duplication is not feasible as the two countries have been walking on different paths in this sector, Cai Kailong, Secretary General of Internet Finance Club 1000's Wall Street branch told Xinhua recently.

Unlike that in the United States, where credit card is a dominant way to make payment, China's credit card payment is still not mature, which leaves room for online third party payment and products with both payment and investing functions, he said.

Cai suggested that China learn from America's experience in structuring a sound and effective system framework of Internet finance.

Product designing is quite important in China, as finance based on mobile Internet and smart phones has witnessed robust development in recent years, Cai said, citing Yu'E Bao, created by e-commerce giant Alibaba's online payment arm Alipay, as an example.

The market entry threshold of Internet financial products in China is relatively low, while in the United States the applicant company needs to provide registered capital and approval from state government, he noted.

The expert suggested that China step up information disclosure, develop individual and enterprise credit system to help raise default costs and consequently reduce defaults, and tighten requirements for Internet finance companies to enter the market.

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