Lujiazui Forum 2013 is being held from June 27 to 29 in Shanghai, theming at“A New Vision for Financial Reform and Opening Up.” Panel Session V: Prospects for Internet Finance, co-organized by the CFCA and Hexun.Com, is held on June 29. Hou Weidong, vice president and CEO of Bank of Communications expresses on the sideline of the forum that internet finance is an emerging financial industry engendered from the profound reformation of financial business making full use of internet technologies.

The following is a transcript of his speech.

The financial sector is facing great changes with internet companies’ continually penetrating from non-financial sector to financial sector. First, in terms of people’s lifestyle, new technologies represented by the Internet have transformed modern people’s life, with e-commerce penetrating into every corner of our life. Smart phones also accompany us walking through streets and lanes, and these are the changes that are happening to us. Along with the development in the field of social communication, we are brought into a brand-new realm. Facing such changes, Banks are becoming or have already become unable to satisfy the needs of future clients, so the internet finance comes into being in this context.

Hou Weidong: What is Internet finance? Some people believe all financial services on the Internet can be called Internet finance, while others think Internet finance is a substitute of banks, and is using the Internet eliminate traditional finance or replace traditional finance. I think, in the first place, the Internet upholds the spirit of openness, cooperation and sharing, which we call the Internet spirit. The future Internet spirit, as I believe, can be described as financial institutions providing customers with personal financial services adapted to the characteristics of the Internet through in-depth reform, under the background of a new internet industry. In other words, Internet finance is an emerging financial industry based on in-depth reform in financial business by the Internet technology. This is the first issue.

(Hexun.com reports associated with China Construction Bank Network)