China’s new financial watchdog gets teeth to take on fintech risks

China has established a new financial watchdog known as the National Administration of Financial Regulation (NAFR) to focus on managing risks in the growing fintech industry. The NAFR will have a special department for technology that will create plans and systems to oversee the safety of information technology. It will also work on protecting against cyber threats and ensuring data security to support the digital economy. This move is part of China's effort to maintain financial stability and prevent illegal financial activities. nnFollowing a significant restructuring of China's financial regulatory framework, the NAFR has absorbed the China Banking and Insurance Regulatory Commission and taken on certain roles from the securities regulator and the central bank. With 27 departments, the NAFR has expanded its reach and will advise on complex financial cases involving new business models. The Financial Consumer Protection Bureau within the NAFR has also seen its authority grow after several financial scandals, such as the disappearance of a large sum of money from a rural bank in Henan. The NAFR has committed to a thorough supervision of the financial sector and to addressing issues like local government debt and the real estate market. nnThe crackdown on financial corruption has intensified, with numerous officials and executives being investigated or disciplined. This includes a former vice-president of ICBC, China's largest bank. The Chinese government has been tightening its grip on the finance and technology sectors to manage risks and centralize control. The establishment of the Central Financial Commission, which falls under the Central Committee, is a part of these institutional changes, with Vice-Premier He Lifeng leading the commission's office.