User:IPickedAName/sandbox
Internet Finance in China is characterized by it's widespread adoption of mobile payment systems and it's heavy regulation by the Chinese Government. As many of the traditional banking services are difficult to access for much of the population, alternative finance options are prevalent.
Mobile Payment
[edit]Online payment through apps such as Alipay and WeChat are the most common form of payment within China. These apps also have the capability of sending money to others. Alipay functions as a digital wallet while WeChat is a social media app with digital wallet capabilities. These apps are used not only online but in-person as well. For in-person businesses, this is accomplished using QR codes that one can scan with their mobile device. It has become the most popular method of payment in China. It bypasses traditional banks in favor of personal spending.
Lending
[edit]Micro-loan apps are very common in China. Due to a lack of easy access to traditional banking services, as the system is nationalized, online micro-loans have become common. It is an easy way to serve customer's credit needs.
In 2021 the Chinese government banned micro loan lenders from creating new loans to college students. For institutions without financial licenses, they are also banned from offering credit services to college students.[1]
Investments
[edit]Equity
[edit]Traditional equity investment in China is limited as the Chinese government limits the amount a domestic trader can invest abroad.
Futubull & Tiger Trade are both apps for small time investors in China to personally invest in stocks. These are run by companies Futu Holdings and Up Fintech Holding. Their services are similar to a popular American app created by Robinhood Markets called Robinhood. In 2022 the Chinese government required these apps to stop taking on new users.[2] Old users were only allowed to invest what was already within the app, they were not allowed to invest any more money.
As of May 2023, both Futubull and Tiger Trade planned on pulling their apps from application stores in China. [3]
Cryptocurrency
In 2021 the purchasing, selling and trading of crypto currency was banned in China.[4] It is still possible to buy and sell cryptocurrency through other channels. A popular cryptocurrency trading app named Huobi has encouraged it's Chinese users to apply for digital citizenship from Dominica. With this digital citizenship Chinese domestic traders are able to buy and sell cryptocurrency.[5]
Although never officially banned, NFTS were cautioned against in May of 2023 as they share traits with cryptocurrency, which is still banned.[6] In November of 2023, the Chinese government declared that NFTS are online virtual property, expanding protections for the category.[7]
Digital Currency
[edit]Since 2014, the central bank of China, The People's Bank of China, have been working on creating a digital currency. This was called digital renminbi or e-CNY. It has been claimed that it was developed out of a desire to create a central payment system to replace the large tech companies such as Alibaba.[8] The currency is legal tender and is equivalent to the Chinese yuan. It is managed solely by the People's Bank of China meaning it is centralized, which is how it differs from cryptocurrency. It debuted in four cities in China in 2020. In July of 2023, a SIM based e-wallet service was announced through mobile carriers China Telecom and China Unicom.[9]
- ^ "UPDATE 1-China bans micro lenders from offering new consumer loans to college students". Reuters. 2021-03-17. Retrieved 2023-11-10.
- ^ Soon, Weilun (2022-12-30). "China Regulator Says Futu, Up Fintech Violated Laws". Wall Street Journal. ISSN 0099-9660. Retrieved 2023-11-09.
- ^ Areddy, James T.; Yu, Elaine (2023-05-16). "WSJ News Exclusive | Two Trading Apps That Allowed Chinese Citizens to Invest Overseas Get Pulled From China". Wall Street Journal. ISSN 0099-9660. Retrieved 2023-11-09.
- ^ Kowsmann, Patricia; Ostroff, Caitlin (2023-08-02). "WSJ News Exclusive | Crypto Is Illegal in China. Binance Does $90 Billion of Business There Anyway". Wall Street Journal. ISSN 0099-9660. Retrieved 2023-11-10.
- ^ htxofficial (2023-03-23). "From Crypto to the Caribbean: Huobi Paves the Way for Dominica's Digital Revolution". HTXofficial. Retrieved 2023-11-10.
- ^ Handagama, Sandali (2023-05-17). "China's Top Prosecution Agency Says Although Not Banned NFTs Have Crypto-Like Attributes". www.coindesk.com. Retrieved 2023-11-10.
- ^ Sun, Zhiyuan (2023-11-09). "China's surprise NFT move, Hong Kong's $15M Bitcoin fund: Asia Express". Cointelegraph Magazine. Retrieved 2023-11-10.
- ^ "What's next for China's digital currency?". MIT Technology Review. Retrieved 2023-11-10.
- ^ "Beijing forum promotes SIM-based 'e-CNY hard wallet' for digital payments". South China Morning Post. 2023-10-13. Retrieved 2023-11-10.