Technology Empowers the Modernization of Foreign Exchange Governance System

China Forex: What measures will SAFE take to support the real economy in 2021?

Zhang Tiecheng: We will further broaden and improve the channels of foreign exchange services in order to better cater to the public needs. To achieve this,we will build up one-stop online government services and make sure that services are readily available on portable devices. We will also provide support for pandemic control so as to contribute to the stability and security in all fronts of our socio-economic life. Additionally,we will connect our digital foreign exchange administration platform to more users in order to facilitate the access and use of the Administration’s online system by financial institutions and enterprises.

In addition,we will increase application scenarios for cross-border blockchain platforms and promote pilot platform applications,for the purpose of facilitating foreign exchange business processing and better support the real economy. In specific terms,we will work on the following aspects: first,we will add a business scenario named “financing with export credit insurance policy”. In this scenario,enterprises can obtain funds with lower risk and better credit through information such as insurance policy and loss compensation. Second,we aim to refine the scenario of “bank-initiated verification of taxation filing on services trade” and expand the pilot scenario of “authenticity examination of facilitation of foreign exchange receipts and payments under the capital account” in order to further facilitate payment. Third,we plan to draw into more data from third-party platforms and explore application scenarios,for instance,the “new western land-sea corridor” and “China-Europe Railway Express”,in order to facilitate cross-border trade settlement and financing. Fourth,the SAFE and its branches will jointly establish a multi-party data sharing mechanism whereby “data are available but invisible”. In this way we aim to foster a cross-border credit service system and support more business activities.

China Forex: What progress can we expect in terms of enhancing risk management via financial and regulatory technologies?

Zhang Tiecheng: In 2021,we will fully tap into the value of data and explore the application of big data,visualization,machine learning and artificial intelligence algorithms. We will utilize technology to build a regulatory framework of “macro-prudential and micro-supervision” without interfering with the foreign exchange market or burdening market players.

At the macro level,we will continue to promote the prudential assessment of banks,prudential management of cross-border financing,and centralized operation of cross-border funds from mu