[2019 Summer Davos] Qian Jun: The new credit mode with the core of big data is the most significant financial innovation

Release time：2019-07-15    

From July 1–3, 2019, the Annual Meeting of New Champions 2019 (the Summer Davos) was successfully held in Dalian, China. Qian Jun, the executive dean and professor of finance, attended several forum events to discuss forefront topics on global environmental challenges, financial developments and technological changes with new champions from around the world. The collisions of various views and opinions presented brilliant highlights.

In this article, we will follow Professor Qian Jun as he experienced Summer Davos in 2019 and take a closer look at his other great ideas!

Future of Financial Services in China and Beyond

On the morning of July 1st, Professor Qian Jun hosted a meeting titled, “The Future of Financial Services in China and Beyond” together with Kai Keller, the director of the Financial Stability, Innovation, and Economic Growth Program at the World Economic Forum. In the meeting, Professor Qian held an in-depth dialogue with distinguished guests like Tang Ning, the founder and CEO of Credit Ease, Mao Zhirong, the managing director and head of the mainland development department of the Hong Kong Stock Exchange on the significant subjects of “the influence of financial technologies on the traditional financial industry” and “the internationalization of the Chinese capital market”.

Shaping the G20 Agenda for 2020

The Summer Davos was held on the heels of the 2019 G20 Osaka Summit, which had just concluded. On the afternoon of July 1st, Fahad Al-mubarak, the Secretary of State and member of the Council of Ministers of Saudi Arabia, the hosting country of the 2020 G20 Summit, called a high-end private meeting in order to shape the agenda for the next summit. Professor Qian Jun attended this meeting and participated in the discussion, “Shaping the G20 Agenda for 2020”, making several proposals on various topics of energy use and climate change, technology and national security, as well as other topics including financial technology.

Predictions on AI’s Application to the Financial Sector

Technological change tends to be a significant topic at this annual meeting. On the evening of July 1st, FT Chinese hosted the “2019 Night Talk of New Champions of Smart Enterprises”, where Professor Qian Jun shared his view on AI. He held that financial technologies presented their value toward financial development by promoting the solution of the key problem of asymmetric information in the financial sector. Presently, the application of AI to the investment (robot financing) sector can help avoid common irrational mistakes and rectify these mistakes, which will bring more benefits to investors. Following these steps, AI can have a great influence on the financial sector. However, AI may also become a challenge to Reg-tech. For example, when AI programs with malicious intent result in crippling crashes and heavy losses on the market, there is still much disagreement on how to convict those responsible for such attacks.

Technology and Capital Market in China

With the recent inauguration of the STAR market, China’s capital market has ushered in a historic moment that deserves global recognition. On July 2nd, Professor Qian Jun attended the sub-forum “Technology and the Capital Market in China” and made his keynote speech on the STAR market and registration system, which is an appealing topic to a number of foreign entrepreneurs investing abroad. As a brand new mechanism, how the STAR market will influence China’s capital market and the global technology ecosystem is the top concern for attendants.

Explore Innovative Values of Financial Technologies

On the evening of July 2nd, Professor Qian Jun attended the “2019 Night Talk of Tensent Summer Davos” and spoke on the topic of “Integration and Advancement - Finance and Consumption under Digital Drives”. As for “financial innovation”, Professor Qian Jun contributed the following opinions: ”The most important purpose of finance is to serve the real economy. Based on this, financial innovations, if able to promote the real economy by solving the key problem of asymmetric information in the financial sector, can be recognized for their profound significance. From this point of view, the new credit mode with the core of big data, such as Ant Financial, JD Financial, WeBank and MYbank, is a kind of financial innovation with a most profound significance in China, as it has made great contributions to the real economy, while overcoming the key problem of asymmetric information in the financial sector and truly solving the financing difficulty for small and medium enterprises worldwide.” As for the possible risks that the financial technology sector might encounter in the future, Professor Qian Jun noted, “With the rapid changes in financial technologies, the core business of finance has always kept a high threshold for capital, risk control, and talents. As there have been an increasing number of new economic formats, the influx of a large number of unqualified persons or institutions into the industry in an unclear or deficient regulatory environment might trigger a systematic crisis.”

Backer or Blocker? Market Concentration in Start-Up Funding

On July 3rd, Professor Qian Jun met with Wu Fengyi, Minister of the Department of Large and Small Enterprises and Export Promotions, as well as other honored guests. Together they discussed how the market concentration of the technology sector would influence new and innovative companies in acquiring financial support. As the host, Professor Qian Jun took the lead in expressing his concepts. Firstly, the source and portfolio of capital are very important to start-ups, and they need to keep dynamic balance between equity capital and debt capital. Secondly, data has gradually become the foundation of high-tech enterprises, and the cost and source to acquire data have also been of greater importance to the success of start-ups. Meanwhile, business founders need to maintain the independence of their enterprises while still trying to get as much investment as possible. For this, Ms. Wu Fengyi agreed and talked about his experience with the Canadian government, such as making a direct investment on enterprises and providing support in establishing risk funds to balance the equity capital and debt capital of enterprises. From these experiences, according to Professor Qian Jun, there is much to be learned.