By FintechNews staff
-Advancements in artificial intelligence (AI), cloud computing, big data, blockchain and e-commerce have come at the cost of personal data protection, as financial institutions adopt fintech, said the Chinese central bank’s Governor Yi Gang.
-China’s central bank governor vowed to keep strengthening regulation of financial technology (fintech) companies, focusing on areas including payment services, antitrust issues and data protection.
-Yi stressed in the speech that any “inappropriate connection” between the financial and business information systems in fintech companies should be cut off to prevent perceived monopolistic activities arising from the so-called closed-loop effect of “data-network effect-financial business”.
-Yi’s speech underscores the legal framework for personal data protection that is taking shape in China with the passage of a data security law this year and a personal information protection law, which became effective this month.
-Firewalls should be built to prevent cross-sector risk contagion, and all financial services should run after receiving licences from regulators, including personal credit information service, he added.
– It also bookmarks the year-long crackdown by Chinese financial and antitrust regulators on fintech giants such as Ant Group, Tencent Holding’s WeChat and JD.com’s JD Digits businesses over the storage, usage and management of personal data collected by technology platforms.
-Authorities had identified more than a thousand issues relating to the fintech operations of 14 internet platforms.
-In order to protect personal credit information, Chinese financial regulators have required fintech companies to isolate their personal credit information business units. Financial institutions are allowed to provide such services only after they receive licenses. Some Big Tech companies have either collected data without permission or misused them. There are also cases of customer data leakage. Therefore, strengthening personal data protection is urgent.
-Data protection and the promotion of fairer use of data is intended to “unleash the vitality and innovation capacity of market players,” Yi said. “Going forward, we will continue to improve the legal framework for personal data protection in the financial sector and strengthen regulation accordingly.”
