Financial technology (fintech) applications owe much of their development to core technologies like AI and big data. Yet this also comes with security challenges.
During a recent interview, Huang Zhen, professor and director of the Research Institute for Financial Law at Central University of Finance and Economics, told the Xinhua News Agency that using fintech to prevent and control financial risks should be part of China’s core competitiveness.
Huang first noted technological security is a top priority to determine whether a technology is stable, reliable and safe, Huang said.
Because new technologies involve terminal devices that collect, store and use personal data, managing financial data is another line of defense, Huang said. It is also imperative to guarantee the security of funds at every stage of the chain, including related networks and infrastructure.
Huang said that fintech plays an important role in preventing major risks in the financial industry. Fintech made a similar shift towards risk prevention and control as the industry further developed in line with the State’s initiative to prevent and control financial risks, such as in compliance fintech and credit investigation fintech.
We cannot develop technologies behind closed doors, he argued. Cooperating with regulations will better prevent and control risks. For example, we should use big data as a control measure to monitor, prevent and handle risks.
The financial industry itself is an industry that manages risk, so we need to use technologies to insulate and disperse risk, such as distributed transaction structures based on blockchain.
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