China and India to intensify fintech oversight as risks mount

Fitch believes that the possibility of disruption is higher in these markets.

Regulators in China and India are expected to intensify oversight over the fintech sector rather than encourage the adoption of emerging technologies amidst its larger perceived impact on stability, according to credit rating agency Fitch.

Developed markets like Singapore and Hong Kong, on the other hand, will continue to foster the development and integration of such technologies unlike emerging markets which are likely to strengthen regulatory practices first.

“[W]e expect most regulators in emerging markets, such as China and India, where financial inclusion is lower and as a result the potential for disruption is greater, to manage the pace of fintech adoption in the non-bank sector as to limit potential risks to financial stability.

China and India are the two main APAC markets where regulatory restrictions are likely to influence the pace of fintech development, Fitch added. Chinese regulation of online lending has strengthened amidst the country’s deleveraging campaign, with the provision of new micro-lending practices halted in November 2017.

Central banks are also expected to intensify cooperation in cross-border matters like trade finance with Singapore and Hong Kong already partnering up for a number of initiatives.

News Source: Link