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Chinese consumers are rapidly moving towards non-bank and cashless alternatives, such as Alibaba’s $60 bln financial application Alipay.
Chinese consumers are rapidly moving towards non-bank and cashless alternatives, such as Alibaba’s $60 bln financial application Alipay. To cope with the rapid growth rate of its FinTech industry, Chinese state-owned companies launched a $1.5 bln fund to support emerging FinTech startups and technologies.
The consortium of Chinese state-owned companies which includes Hong Kong-listed Credit China FinTech Holdings, Shanghai Xinhua Distribution Group, China Huarong International and 8 other major organizations in the mainland, established a fund known as “Asia FinTech Merger and Acquisition Fund of Funds” to ensure every market within the Chinese FinTech industry can operate with necessary capital.
Sheng Jia, Executive Director of Credit China FinTech stated:
Leveraging on the fund partners’ experiences and competitive advantages in brand recognition, industry resources and expertise, the Fund aims to invest in innovative FinTech enterprises with potential and help them to be the FinTech leaders with our technical know-how and capital resources.
According to various sources, the fund will support startups in a wide range of categories within the FinTech industry, including big data, artificial intelligence, mobile payments, supply chain financing and Blockchain technology, developing a portfolio which covers every aspect of the country’s FinTech industry.
Previously, Cointelegraph reported that Chinese consumers are no longer reliant on the bank and fiat-based financial systems and payment applications, primarily due to their inefficiency in payment settlement.
Cointelegraph’s article entitled “FinTech Boom: China Going Cashless, Consumers Ditching Banks,” revealed that the world’s top 10 largest FinTech companies belonged to the Chinese FinTech market and that the explosive growth of these companies directly describes the ever-changing financial situation within the country.
Some experts and analysts from the mainland stated that foreigners or foreign analysts would be shocked at the rate of the growth of the FinTech industry because it is becoming increasingly difficult to discover people that use bank-based systems like a credit card or bank transfer on a daily basis.
With other alternatives like Bitcoin also gaining mainstream exposure and observing significant growth within the Chinese FinTech market, it is likely to see the country continue to lead the global FinTech ecosystem throughout 2017, as it did last year.
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