Internet Finance Innovation Is Hitting China's Banking Sector

Innovation in Internet finance has exploded in China in 2014. Eight months after Alibaba launched Yuebao, the fund had attracted 81 million users and its total value skyrocketed to US$81 billion; Yuebao's success has spurred other Internet companies to burst onto the scene with similar products. The sharp rise of the Internet finance business in China — and the acceptance of products like Yuebao — is intensifying the pressure on traditional financial institutions, making it imperative that they innovate, and quickly. This report analyzes why eBusiness professionals in traditional banks must drive financial innovation to cope with the tough competition resulting from Internet companies' digital disruption.