Financial regulators should utilize technology and monitor the size of innovative businesses to tackle risks brought by financial technology, experts told the annual Lujiazui Forum yesterday.
Deng Zhiyi, director-general of the trust institution supervision department of the China Banking Regulatory Commission, compares the future financial market to a road of self-driving cars as financial institutions increasingly become automated.
Existing regulatory methods are not capable of handling the new risks, just as traffic police are unable to deal with the legal issues of self-driving systems.
Fintech, or financial tech-nology, poses new risks as the involvement of technology companies in the financial system complicates data security and risk management, Deng said.
The changing landscape requires regulators to impose new compliance requirements in the automated process as one possible solution to tackle new risks.
Macau Monetary Authority's Chairman Teng Lin Seng, said technology brings benefits and risks.
It is up to regulators to keep the sector on the right course, he added.
He said regulators must allow space for innovative businesses within the existing legal and regulatory framework, while maintaining real-time powers to either punish or encourage such new businesses.