Yuebao will not be proscribed, says Zhou Xiaochuan

Zhou Xiaochuan, governor of the People’s Bank of China, has said that financial products like Yuebao will definitely not be proscribed, adding that the Bank does not have strict regulations in this regard yet, and some policies are set to be refined.

Whereas Li Rongrong, deputy governor of the Bank, has said that issues related to Yuebao are still under investigation, and such products will be regulated.

Zhou Xuedong, deputy to China’s National People’s Congress and head of the Nanjing branch of the People’s Bank, has suggested revising laws on internet finance and managing it by dividing it into three types of operations: ‘clearing’, ‘financing’ and ‘investment, finance and insurance’. He added that at the moment the authorities should encourage this newly born industry to develop and innovate, but the authorities, including the People’s Bank, China Bank Regulatory Commission (CBRC), China Securities Regulatory Commission (CSRC) and China Insurance Regulatory Commission (CIRC), should introduce regulations against potential harm.

Sun Lijian, director of the Institute of Finance at Fudan University, has also agreed that there is no need to prohibit Yuebao, but regulations should be in place to enhance the risk and capital management of such operations.