According to a think tank in China, the country should begin introducing the framework that regulates artificial intelligence in the financial industry. Technology should be enhanced and used by regulators to strengthen supervision. According to the former securities regulator in China, artificial intelligence should not be treated like any other technology.
The technology needed to regulate intelligent finance applications has mostly lagged in development. According to businesstimes.com, organizations involved in banking, securities and various financial products using technology such as Big Data analysis and facial recognition to improve sales returns and investments need to step up their regulations.
Plans should be considered to evaluate industry-wide emerging technologies to create laws for privacy protection and security of data. Many hard lessons were learned during the online peer-to-peer lending that ended up being a complete bust. This is because the necessary laws and regulations were not introduced when needed.
The P2P industry of China is seen as a crucial source of credit, but it has been undermined lately by absent bosses, pyramid-schemes and a lack of broad government crackdowns. The right changes will have to be made by policymakers.
It has been suggested by officials that regulations for artificial intelligence usage in the financial industry be written into China’s five-year plan. This is the 14th plan the country has created that lists regulations about the country’s development and financial sectors including insurance regulators, banking and the central bank of China. It will also list regulations for the securities watchdog.
The securities watchdog will need to appoint a chief tech officer to further supervise the industry. It has also been suggested the data platforms for each financial industry body be able to monitor risks easier. This will enable quicker responses when issues come about.
Spending on artificial intelligence in China has increased significantly in the finance and banking industries. The investment numbers have been consolidated and are primarily from the top five payment firms and financial institutions in the country. This is on top of tech companies and start-ups. Businesses in the mid-tier of the industry are lagging and have limited artificial intelligence initiatives.
This differs greatly from the United States. There has been an increase in these mid-tier financial organizations with AI. One of the key differences between China and the U.S. is the Chinese government placing more focus on the development and implementations of artificial intelligence across all sectors. This has led to an increase in the speed of execution of new tech.
Dil Bole Oberoi
