The significance of financial technology to national security. (1) Demand for credit innovation: driven by the demand for industrial security and localization substitution, the country began the layout of financial credit innovation in 2019. In 2019, China has launched the first batch of financial information innovation pilot projects of 47 financial institutions. (2) Demand for financial stability: there are systemic risks in the existing cross-border payment system. Compared with the existing electronic payment system, the central bank’s digital currency has made great improvements in the security and efficiency of cross-border payment technology. The implementation of digital RMB is expected to protect China’s financial security and stability.
Security planning and solutions related to fintech’s 14th five year plan: on February 9, 2022, the people’s Bank of China, the State Administration of market supervision, the China Banking and Insurance Regulatory Commission and the China Securities Regulatory Commission jointly issued the 14th five year plan for the development of financial standardization, in which the security related planning includes the following areas. (1) Improve financial information infrastructure: formulate Data Center disaster recovery system standards. The financial industry has higher requirements for data security and strong requirements for business continuity. Generally, the traditional single data center mode and the high availability mode of two centers in the same city can not meet the needs of the financial cloud. The financial cloud architecture needs to meet the ultra-high availability architecture mode. (2) We will strengthen the protection of financial network security standards and promote the construction of security and controllable standards for the core technology of informatization in the financial industry. The construction of it core technology security and controllable standards in the financial industry includes the formulation of technical requirements for core business systems and financial machines and tools, including the information creation of server and terminal, and supporting the construction of distributed and centralized dual core architecture. (3) We will steadily promote the development of legal digital currency standards and deepen the high-level opening of financial standardization. To steadily promote the development of legal digital currency standard, we need to comprehensively consider various factors such as secure and reliable infrastructure, issuance system and storage system, digital RMB system and so on. At the same time, the 14th five year plan requires accelerating the transformation and application of advanced international financial standards, including accelerating the construction of China’s financial industry general newspaper library, and vigorously promoting the application of global legal person identification code in financial risk monitoring, cross-border legal person digital identification, cross-border payment and other cross-border transaction scenarios.
Layout prospect of key areas: (1) financial information innovation: in order to support the implementation and application of China’s independently developed products and technologies, financial information innovation will also complete two pilot phases in 2020 and 2021. The pilot scope is from large banks, securities, insurance and other institutions to small and medium-sized financial institutions. (2) Digital RMB and cross-border payment: the issuance and use of digital RMB will enhance the international competitiveness of RMB, and bank it integrators will first benefit from the implementation of digital RMB. One belt, one road and RCEP will help CIPS countries step into the CIPS system, promote the internationalization of RMB and reduce China’s dependence on SWIFT system. In the field of the combination of digital RMB and cross-border payment, China has joined the multilateral central bank digital currency bridge research project (m-cbdcbridge) led by the innovation center of the bank for International Settlements (bisih). (3) Privacy calculation: the 14th five year plan requires to coordinate the development and utilization of financial data, public security, trade secrets and personal privacy protection, and accelerate the improvement of standards and norms such as property rights of financial data resources, transaction circulation, cross-border transmission and security protection. The integration of Finance and digital technology is deepening, the integration and application of cross fields are continuously strengthened, and the sharing and opening of data is becoming a new trend in the financial industry.
Investment proposal and investment object
In the future, the field of financial technology security will focus on financial information innovation, digital RMB, cross-border payment, privacy computing and other fields. It is suggested to pay attention to financial information and innovation companies Digital China Information Service Company Ltd(000555) ( Digital China Information Service Company Ltd(000555) , buy), Yusys Technologies Co.Ltd(300674) ( Yusys Technologies Co.Ltd(300674) , not rated), Shenzhen Sunline Tech Co.Ltd(300348) ( Shenzhen Sunline Tech Co.Ltd(300348) , not rated), Tansun Technology Co.Ltd(300872) ( Tansun Technology Co.Ltd(300872) , not rated), China National Software And Service Company Limited(600536) International (00354, not rated); Bank IT service providers and cross-border payment system integrators in the field of digital RMB Yusys Technologies Co.Ltd(300674) ( Yusys Technologies Co.Ltd(300674) , not rated), Shenzhen Forms Syntron Information Co.Ltd(300468) ( Shenzhen Forms Syntron Information Co.Ltd(300468) , not rated); Third party payment acquirer Lakala Payment Co.Ltd(300773) ( Lakala Payment Co.Ltd(300773) , not rated), card transfer (09923, not rated), Xgd Inc(300130) ( Xgd Inc(300130) , not rated), Hyunion Holding Co.Ltd(002537) ( Hyunion Holding Co.Ltd(002537) , not rated); The objects of privacy calculation are lianyirong technology-w (09959, not rated) and financial one account link (ocft. N, not rated).
Risk tips
The proportion of IT investment in the financial industry is lower than expected; Uncertain policies in the field of financial technology; The project landing cycle is uncertain.
