The fintech sector is growing faster than anyone imagined. Modern technology has transformed most financial functions through AI, ML, IoT and automation. This escalated growth means tech titans and behemoths must be held accountable for bad practice. As a result, The China Banking and Insurance Regulatory Commission (CBIRC) and the People’s Bank of China (PBoC), the country’s central bank plan to implement “special and innovative regulatory measures” on fintech companies such as Jack Ma’s Ant Group Co, the financial affiliate of Alibaba Group Holding Ltd.

This latest move was aimed to eliminate autocratic practices and boosting risk controls. China plans to impose stricter anti-trust oversight by big businesses. Companies in the likes of Alibaba Group and Tencent Holdings have been scaling up in the financial sector with less oversight, therefore, posing a massive challenge for regulators and banks.

Highlighting the regulations for the next five years, CBIRC chairman and PBoC party secretary Guo Shuqing said that financial innovations are a “double-edged sword”, as reported by Bloomberg which cited Shanghai Securities News. He added there is little “experience in legal standards and risk monitoring for mobile payments or internet borrowing and insurance in our country”.

It has become China’s national agenda for its top watchdogs – PBoC, CBIRC and the CSRS – to impose regulations and crackdown on potential financial risks, Bloomberg added. Only last month, China pulled the plug on Ant group’s $37b IPO – a listing which would have been the largest in history. The chances for the IPO to go through in 2021 still remain slim according to regulators.

Shuqing noted that without having adequate capital, financial services could “get into trouble sooner or later.”

“The regulations should cover all financial institutions, businesses and products. Online loan companies have skirted the rules under the camouflage of financial innovation,” he added.

Commenting on the property sector, Shuqing claimed that it continues to be the country’s “gray rhino” with respect to financial threats.