Zhinews of Shenzhen Satellite TV:

Digital financing has been developing rapidly. What new plans and strategies have been formulated to strengthen digital financing regulation and risk control, as well as promote innovation in financial technology? Thank you.

Liu Zhiqing:

Thank you for your question. People are concerned with the progress made in digital financing as well as related regulation. At present, digital technologies, such as internet technology, big data, cloud computing, artificial intelligence, and blockchain, are developing rapidly and transforming our way of living and production. The central financial work conference proposed five initiatives, including one targeting digital financing. We are paying great attention to this sector and have adopted a series of measures to promote digital financing and to steer the digital transformation of the financial sector. For example, we encourage banks and insurers to continue to enrich digital financing products and services in the important fields involving small and micro-sized businesses, green development, agriculture, rural areas, and rural residents, sci-tech innovation, and global trade. We continue to follow up on the implementation of the previously released guidelines on the digital transformation of banking and insurance sectors, advance the objectives and tasks of digital transformation of financing step by step, and promote exchanges of digital transformation experiences between institutions. We support large institutions to fully mobilize internal resources, offer risk control tools and technologies to small and medium-sized financial institutions under market-oriented and law-based principles, and help small and medium-sized financial institutions enhance risk management. Mr. Xiao just mentioned several examples of cooperation. Through collective efforts of financial institutions and supervisory departments, the financial sector's digital transformation advanced quickly, offering products and services with better quality and effect to benefit the real economy. 

We will continue to strengthen supervision and guidance and promote digital financing with diversified measures. We will guide financial institutions to improve the quality and effect of services and thoroughly enhance risk management. 

First, we will continue to promote digital transformation in the banking and insurance sectors. We will conduct assessments of digital transformation-related work and incorporate them into the supervisory and rating system of banking and insurance sectors' use of information technology. We will guide financial institutions to strengthen top design and coordinated planning, devise science-based development strategies, increase investment in resources and factors of production, and reform management and services. 

Second, we will enhance the effectiveness of digital empowerment. We will fully mobilize financial institutions to initiate actions, continue to optimize digital financial products and services, provide financial support in important areas such as sci-tech innovation, advanced manufacturing, green development, and development of micro, small and medium-sized enterprises, and effectively reduce corporate financing costs. Financial institutions will actively expand service channels, including mobile internet terminals, reach out through digital technologies to clients that traditional financial services have difficulty attracting, and continue to elevate the inclusiveness and accessibility of financial services. 

Third, we will improve the risk prevention and control capabilities of related industries. We will push banks and insurers to integrate digital risk control tools into their workflows, fully utilizing digital capabilities to level up risk management, internal control and compliance.

Fourth, we will improve the supervision of network safety and data security risks. We will push banks and insurers to improve regular monitoring of network safety risks and emergency response capabilities, effectively protecting data security and client information, and enhancing the risk management of technology outsourcing in digital ecosystem scenarios. 

Fifth, we will regulate digital innovation and secure the bottom line of risk control. We will demand that banks and insurers establish prudent approval processes, assess the technological and business logic changes brought by new products, new businesses, and new modes, and make sure that the use of new technologies is prudent and compliant with regulations so as to secure the bottom line and prevent risks while going through digital transformation. Thank you. 

Xing Huina:

Due to time constraints, we will now take one last question.