New entrants pose tough challenges to established financial sector players

Players in the fast-evolving digital finance arena will compete on the four "commanding heights" of applications, infrastructure, platforms and channels, and traditional financial institutions need to develop a new mindset to compete, according to a report released on Thursday by The Boston Consulting Group.

Digital finance, the most vibrant segment of China's financial services industry in the past year, has experienced an influx of new competitors including Internet companies, emerging digital finance operators (peer-to-peer lending, crowdfunding and vertical search providers), telecom carriers and infrastructure vendors.

They all pose a challenge to the longstanding dominance of conventional financial institutions such as banks, insurers and securities firms.