Fintech Companies Pose a Strategy for Small Enterprises
COVID-19 and China

Nov 30, WANG Zhengming(王正明), the vice president of Bairong Finance Information Service Co., Ltd.(百融金融信息服务股份有限公司) delivered a speech themed Challenges and Chances in Fintech for Financial Inclusion at the FinTech Innovators Forum, a sub-forum of 2018 EO Innovators Annual Conference held by EqualOcean and sister website亿欧公司).

Bairong provides credit management products and services using artificial intelligence(AI) techniques. According to Crunchbase, the company has raised CNY 1.7 billion (USD 270 million)   from two financing rounds in total. Its existing investors include China Reform Fund Management(国新科创基金) and Sequoia Capital. China Reform Fund Management is a private equity firm backed by China Reform Holdings Corporation Ltd and other central state-owned enterprises.

FinTech market is up for grabs. Big data, cloud computing, artificial intelligence and blockchain can be applied to various industrial scenarios including precision marketing, tailored customer service, discriminated price control, disputes management and debt collection.

The traditional financial sector is facing new challenges and opportunities brought by the innovation of information technology. What the trend of FinTech is and how to combine emerging technologies to enhance the financial business are significant issues for financial institutions to think over.

As for the small businesses, WANG pointed out pain points that the industry is facing.

First, the lack of data. For small enterprises,  it's difficult to conduct risk control for them, but there is substitution way to tend to such official institutions as Industrial and Commercial Bureau, justice departments, and trace entrepreneurs and business activities. In the past years, a few financial institutions offered a rare amount of financial services for small enterprises. Therefore, it's hard to build a credit evaluation model to conduct risk assurance.

Second, lower profits for serving small businesses than retail enterprises for interest rates are limited by authorities. Besides, due to higher risks of small businesses, financial institutions are burden with expensive labor cost in due diligence.

The last challenge points to the difficulty of commercials. Different from retail enterprises, it's less easy to attract small business clients from such social media as Tik TOK and acquire respective risk assessment data.

It is predicted that financial demand of this field will approach CNY 9 trillion for the upcoming three years, according to China Small and Micro-Finance Development Report conducted by China Minsheng Bank and Diyi Caijing published on Dec 10, 2018.

There is still a conspicuous gap between supply and demand of financial inclusion in China. Fintech companies help financial firms managing the lending process across the whole life-cycle of a loan agreement. 

——Author: ZHENG Shiyu; Editors: ZHANG Fan& LinYan. Write to ZHENG Shiyu at

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