The influence of digitalization on Chinese banks: new financial technologies in a plan economy

Nowadays, digitalization has become one of the most significant global development trends. The Chinese banking system, which has only recently been subjected to liberal reforms, is poorly researched in the viewpoint of the digitalization and financial technology impact on it. In this context, it is interesting to identify the main digitalization features in the PRC banking system and to identify this system’s elements which are most susceptible to digitalization influence. The authors set the task to identify how digitalization changes the PRC banking system, in particular, how it affects shadow banking. The major challenges of the article are the high share of the closed data on the Chinese financial sector, the unclarity of the shadow banking activities in the country and their overall negative influence on the economy of PRC and Asian economies and the highly theoretical nature of the digitalization research of banking in the scientific community. The main article’s results consist in that the main differences between digitalization and fintech are determined; it was also proved the Chinese banking system is more adaptable to changing conditions, and the authors suggested the main measures to reduce the shadow banking’ share in China. The main contribution of the article is the revelation of the possible solutions to the problems of shadow banking in China through the use of the new financial instruments of the digital era