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Published on : Aug 20, 2015

China has always been on the forefront of adopting the smart and latest technologies, accessing money online through smartphones being one of them. The Chinese Twitter, Open Tencent Holdings’ WeChat, the tap version of PayPal in China, E*Trade, Amazon, Uber, and TripAdvisor are now effectively rolled into an individual app, Bloomberg Market reported in its October issue. The latest technology will render breakthrough services to consumers in China, who can now pay the taxi, book a restaurant, or even split the bill with a friend electronically. With a few minutes to spare, the Chinese consumers can also transfer their money easily into the mutual funds run by Alibaba Holding Group using their smartphones. 

The onset of financial innovation has engulfed the whole world, but China is the abode where digital investing, lending, and banking has gone mainstream. The IT companies with their financial apps are posing serious threat to the existence of the conventional banks and intermediaries for a market comprising over 1.3 billion people and holding deposits of over US$7.8 trillion. Tencent’s WeChat, also called Weixin in Chinese, Baidu, and Alipav arm of Alibaba are making headwinds in the industry with their digital wallets that let consumers conveniently mange financial transaction through their smartphones. 

Speaking about the latest trend in China, the managing director of Shanghai-based consulting firm, Kapronasia, Zennon Kapron said that presently financial innovation is discussed everywhere around the world from New York to London and from Hong Kong to San Francisco. However, it is the mainland China that has gone beyond the levels of discussion and have started implementing the digital technologies in reality. Hence, China is definitely working ahead towards the future of global banking. 

The indigenous and backward methods of traditional banking in China provides considerable opportunities for the nimble tech companies such as Baidu and Alibaba. These companies are capitalizing on the digital era not only to make consumers’ lives easier but to capitalize on the lucrative opportunities that the banking sector in China beholds.