Janos Barberis

Founder & CEO, FinTech Hong Kong

P2P lending in China - From shadow banking to shadow lending

Financial Technology or “FinTech” refers to the use of technology to deliver financial solutions. Since, the time the term was coined it has caught the attention of regulators, industry players and investors alike. The terms now refers to an industry representing US$12 billion in investment in 2014 whilst managing or intermediation many more billions in assets or transactions. Beyond the growth of this market the sector has been asking and is being subject to intensified regulatory scrutiny. In either case this is warranted given the ever increasing role FinTech plays in respect to the functioning of financial markets. As a result this paper sets to undertake a forward looking analysis of the regulatory implications of the FinTech sector. It does so by taking a historical perspective as to how technological innovation has been applied within the financial sector. It is submitted that that doing so allows to pre-empt certain regulatory (re)action in respect to the sector. Importantly the paper provides the reader a framework to understand how and why a balancing act between financial technology and regulation can be achieved. In order to do so, this research is structured around four main axes.

The first part provides a working definition of the FinTech sector and offers a historical “scene setting” of how the application of technology in finance has shaped the industry as we know it. The second part sets out how in the context of this technologic al innovation can regulator approach these changes and able to adapt to them given their mandates. The third part looks at a series of case studies will high light the fact that regulators need to pro-actively interact with this industry so as to perform and uphold their mandates. In closing, the fourth part opens up future topics of research that are drawn from actual new business models (e.g. API Banking) or new market reforms (e.g. Mainland China).

Janos Barberis’ expertise regards the new regulatory considerations generated by the development of the FinTech Sector. He founded FinTech HK, which he established to spur Hong Kong's FinTech eco-system. This led him to produce Hong Kong’s first FinTech report viewed over 17’000 times. He was appointed as a Senior Research Fellow at the Asian Institute of International Financial Law (at The University of Hong Kong) specifically focusing on developing regional Fintech regulatory frameworks. In parallel, Janos sits on the advisory board of the World Economic Forum’s (WEF) FinTech Committee.

Previously, Janos was an Associate at a prospective UK retail bank, Lintel, helping it to secure a banking license from the PRA & FCA. His role follows a specialist interest developed over 7 years, in financial systems and their stability. Notably, Janos proposed to reform the Chinese shadow banking sector by developing P2P lending channels.

Janos holds an LLM in Corporate and Financial Law (HKU) as well as a BSc in Economics & Finance and LLB in Law (UK). Having been awarded a Postgraduate Scholarship, he will be a forthcoming PhD candidate at HKU Law School working on strategies to enhance Hong Kong’s financial centre status by designing the adequate regulatory framework.

Janos Barberis