Beijing and Shanghai top the list of cities ranked best for fostering a fintech industry in a study of global financial centers, while four of the top five are Chinese.
The semi-annual survey, conducted by the Shenzhen-based think tank China Development Institute (CDI) and the London-based think tank Z/Yen Partners, was published on Thursday.
Why it matters: Chinese cities are increasingly being compared with traditional financial hubs like New York and London in part due to a recent boom in fintech services.
- China has been promoting the development of financial innovations including mobile payments, online consumer financial services, and most recently, digital fiat currency.
Details: Shanghai, Beijing, and Shenzhen climbed the global financial center rankings, while Hong Kong retained third place.
- The study included for the first time a separate ranking for fintech, which Beijing and Shanghai topped as the best locations for fintech development. New York, Guangzhou, and Shenzhen rounded out the top five.
- Chinese cities feature heavily in the new fintech ranking, the report noted, reflecting the country’s focus on technology development.
- Shenzhen, a Chinese tech hub and key city in the Greater Bay Area economic development plan, jumped five positions to ninth in the overall global financial center rankings, marking its first appearance in the top ten since 2010.
- Shanghai retained its fifth place overall ranking, but its score shows that it is closing the gap with other top cities.
- The rating for financial centers is based on a wide range of factors including infrastructure readiness, ease of doing business, innovation, and trade, as well as assessments provided by 3,360 respondents in the banking, investment, and other industries.
Context: The Chinese government is a big proponent of fintech development.
- In its newly released three-year fintech development plan, the Chinese central bank said it aims to strengthen support for the fintech sector but continue cleanup efforts in problematic areas.
- Shenzhen, the home base of tech giants including Tencent, Huawei, and ZTE, has emerged as one of the key cities for researching digital fiat currency. The research and promotion of virtual money were included in the new development guideline for the Shenzhen Special Economic Zone.