Internet Plus mode advances rapidly
Drives fundamental transformation in finance
China’s Internet Plus strategy has made astounding achievements in the past five years, mainly driven by the government’s full support and the rapid development of the nation’s communications infrastructure and smartphones, experts noted.
China unveiled its Internet Plus action plan on July 4, 2015, aiming to integrate the Internet with traditional industries, create a new growth engine and promote the transformation and upgrading of the economy.
According to the plan, mobile Internet, cloud computing, big data and the Internet of Things will be integrated with modern manufacturing, to encourage the sound development of e-commerce, industrial networks and Internet banking.
“When applied to traditional industries, Internet Plus can help reduce costs and enhance efficiency, driving the economy in a quite positive way,” Xiang Ligang, chief executive of domestic telecom industry portal cctime.com, told the Global Times on Monday.
Thanks to the government’s support for the construction of the nation’s fourth-generation telecommunications network and the popularization of smartphones, the Internet Plus mode can be utilized smoothly, Xiang said.
China’s Internet finance sector has developed fast in the past few years. According to media reports, 2013 marked the a very important year for China’s Internet finance industry, with landmark events such as Alibaba’s launch of online wealth management product Yu’ebao and Tencent’s launch of its online fund supermarket.
Data from the Beijing-based Economic Daily on July 13, 2017 showed that as of that date, China had about 19,000 online finance platforms, with the total volume of the Internet lending, Internet crowdfunding and online payment sectors reaching about 70 trillion yuan ($10.6 trillion).
The report showed that the Internet finance sector encompassed many activities including online lending and Internet-based asset management.
Several online finance products have also achieved great business success.
For example, data that Alibaba’s financial affiliate Ant Financial sent to the Global Times on Monday showed that Yu’ebao is the world’s largest money market fund with assets of $165.6 billion.
Li Chao, an industry analyst with Beijing-based market consultancy iResearch, said that the development of China’s online finance sector in recent years “has been the best in the world”.
“The rise of Internet finance has been significant in two ways. First, it has spread the concept of wealth management from a small group of elite investors to the public; second, it has made up for the weaknesses of the traditional finance sector, such as its slow processing speed, by us ing advanced technologies like big data,” he told the Global Times on Monday.
According to Li, the emergence of online finance has, in some ways, taken some business resources from traditional financial
institutions like banks, but it has also brought about many positive changes in the traditional sector. “For instance, banks used to divide their business activities by geography. Now they tend to adopt a trans-regional mode such as setting up direct banks or online banks. They copied this model from online finance companies,” he noted. Li said that the two most influential online finance products in recent years had been Yu’ebao and WeChat Hongbao. During this year’s Spring Festival holidays in January-February, a record of 46 billion electronic hongbao were sent and received via Chinese mobile social platform WeChat. The figure was up 43 percent year-on-year. In 2016, China’s third-party payment market is estimated to have reached 20.3 trillion yuan ($2.96 trillion), up 45 year-on-year, according to research firm Enfodesk. In addition to the convenient financial tools, Internet companies are also facilitating travel and transportation based on technology and innovation.
Chinese car-hailing services provider Didi Chuxing is committed to building smart transportation systems to reduce traffic jams, as well as developing intelligent driving for more convenient and safer driving experiences based on its advantages in big data and artificial intelligence, according to the company.
With Internet Plus at the core of its business model, Didi has developed rapidly and contributed to employment. China’s manufacturing sector is also undergoing a major transformation based on Internet Plus along with the “Made in China 2025” plan, which seeks to transform the country from a low-cost manufacturer to a high-technology power in 10 advanced industries by 2025.
Those sectors include robotics, semiconductors and new-energy vehicles.
However, the potential of Internet Plus has not been fully realized because most of its fruit stays at the individual level at the moment instead of the whole society, Xiang noted. “As intelligent technology matures and develops faster, its improvement based on the Internet will play a larger role in society in such areas as management systems, medical care and the health system,” he said.