New Scenarized Connection of CMBYC: A Characteristic Model for the Innovative Application of Fintech in Emerging Markets

SHENZHEN,China,Nov. 15,2022 -- Recently,Mr. Jun Lan,the general manager of CMBYC from China,shared views on Fintech and industry-finance connection. The main contents are as follows:

As digital transformation advancing rapidly across the globe,fintech has gained strong momentum as a disruptive innovation force in the past few years. Unlike in Europe and America,the development of fintech in emerging markets such as China,India and Southeast Asia shows distinctive characteristics,which has garnered increasing attention.

One of the manifestations is the rising power of fintech institutions represented by banks.

Globally,commercial banks have always been the major force to lead reformations in traditional financing activities. Though emerging economies are late-comers in financial industry,they are willing to commit to building up their digital power. Taking Chinese mainland as an example,a number of commercial banks with strong technology capabilities have successfully navigated their digital transformation,and exported their fintech capabilities through technical subsidiaries as part of the efforts to expand customer base and gain stronger business advantages in the new industry-finance cooperation ecology.

Throughout the world,the fintech output and innovative cooperation mode adopted by commercial banks in emerging markets have been driving people to reflect on the definition of fintech.

It is noteworthy that since 2022,CMBYC,a fintech subsidiary with banking background,has been frequently mentioned by many top Chinese and US media outlets,offering an interesting and thought-provoking case.

CMBYC,headquartered inShenzhen,China's financial center as well as science & technology innovation center,is a fintech subsidiary of the world-famous commercial bank,China Merchants Bank. InJuly 2022,the authoritative financial mediaThe Bankerreleased itsTop 1000 World Banks by Tier 1 2022,in which China Merchants Bank ranked 11. This is the 5th year in a row that CMB had been listed in the top 20 in this ranking.

As a unified platform to export China Merchants Bank's financial technology,CMBYC bridges up enterprises and financial institutions by means of scenarized finance through providing full digital solutions for capital and cash flow management. Its innovative 'Industry-Finance Scenarized Connection' model redefines the relationship between financial institutions and companies,providing a new Chinese solution for global bankers to remove information asymmetry between enterprises and financial institutions and facilitate the precise connection between financial needs of enterprises and financial service supply of banks.

Specifically,financial technology refers to technology-driven innovation in financing activities. Financial services involve both financial institutions and enterprises. In Europe and America,fintech is mainly applied by the service side of financial institutions such as insurance,payment,investment consultancy and banking services. Meanwhile,CMBYC enriched the connotation of financial technology,and innovatively applied fintech to capital flow management scenario of enterprises,instead of limited to financial institutions. In fact,enterprises need to engage with banks often when it comes to the internal capital flow scenarios such as settlement management,account management,investment and financing management,costcontroland risk management. Besides,CMB has a profound tradition and deep accumulation in enterprise digital services. In 2017,CMB proposed to build a "fintech bank",which made it one of the initiators of this strategy in the Chinese banking industry; early as in 2007,it launched CBS and other cloud-based treasury management products,earning recognition from many medium and large group enterprises in China. As a fintech subsidiary with banking background,when compared with general software companies,CMBYC has inherent strengths in carrying forward and leveraging advantages in both technology and finance.

The company applied fintech to enterprise digital services due to the distinctive Chinese market environment. In the United States and Europe where the financial industry has fully developed,the commercial credit system and information security protection mechanism are well-established. Therefore,instead of building up fintech capabilities independently,it is easier for commercial banks to cut their input in R&D by purchasing services from professional fintech companies. Thus some analysts argue that,being backed up by professional economic labor division and credit assurance,European and American commercial banks do not have strong motive to export their fintech capabilities.

In contrast,in emerging economies such as China,commercial banks are willing to commit more attention and resources to build their fintech capabilities and independently developed information systems. From the demand side,no longer being constrained by traditional technology,emerging economies are gaining strong momentum in digital economy in recent years. In China,the central authorities have incorporated concept of enterprise digitalization into many policy documents as a major direction for enterprise transformation and upgrading. Moreover,as emerging economies still have a long way to go to perfect the traditional credit system,and it is still difficult for enterprises to access financing and for banks to make financial services accurately drip to enterprises who are most in need,realizing credit enhancement by means of digitization based on the data value of enterprise management scenarios has become their best choice to establish a new commercial credit system.

Focusing on the enterprise capital flow scenario,CMBYC has built a new 'Industry-financeScenarizedConnection'model. It has opened up the closed loop of enterprise capital flow scenario data through digital means to upgrade scenario data; meanwhile,edge-cutting technical tools such as Big Data,artificial intelligence,cloud computing,etc. are applied to help enterprises dredge and increase their scenario data,thus build a scenario-based digital bridge between enterprises and financial institutions,andhelp the manufacturers become more intelligent in business and enable financial institutions to serve them better. This model effectively breaks the information asymmetry between enterprises and banks,and is a typical case of using financial technology to realize credit enhancement by means of digitization.

The meaning of "Fintech= Financial + Technology" may be further expanded. Fintech in emerging markets is no longer confined to traditional financial scenarios. Companies like CMBYC applying fintech in enterprise capital flow management scenarios have sparkled new inspirations for the development of global fintech.

If you want to know more about CMBYC,you can send an email.

Email: hejian@cmbyc.com

Contact Person: Mr. He

Website: https://www.cmbyc.com

Telephone: 0086+400-806-7955