Reconstruction of the Financial Services Ecosystem in the Digital Age

The most prominent feature of the Digitalization 3.0 era is the formal recognition of data as a key production factor, beginning to play the role of “new capital” in the financial system. Under new policies, breakthroughs in data asset capitalization and financing have provided new “collateral” and “credit anchors” for the reconstruction of the financial ecosystem. In recent years, commercial banks have actively explored transforming these data into tradable and pledgeable financial assets, opening up the resource-asset-funding conversion channel.

This shift has a significant impact on industry structure, reshaping the logic of credit assessment for commercial banks. A company’s financing ability is no longer solely dependent on the residual value of factories and equipment but also on its digital survival capability and data governance quality. For example, the “instant approval” green channel for intellectual property pledge financing and dedicated financing scales reflect this logic. In this process, banks’ roles extend from mere fund providers to evaluators and transaction facilitators of data assets, establishing deep connections with data exchanges, law firms, and appraisal agencies to form a new “data + finance” ecosystem. This value transformation based on data elements is a concrete practice of “promoting more optimized resource allocation” as mentioned in the “Implementation Plan for High-Quality Development of Digital Finance in Banking and Insurance.”

Deconstruction and Reorganization of the Value Chain

With the penetration of digital technology, the traditional all-in-one bank model—covering product design, risk pricing, wholesale funding, and end-user sales—is undergoing profound change. Under the new paradigm, core assets shift from physical outlets to application programming interfaces (APIs) and trust chains. Access methods transition from in-branch visits to embedded services, and risk control logic moves from reliance on financial statements to behavior data. Financial services are no longer a standalone “place” but a form of “behavior” seamlessly embedded into users’ digital lives. For example, large state-owned banks, leveraging their capital and technological advantages, are evolving into “Banking-as-a-Service” (BaaS) platforms. The combined private banking assets of the four major banks—Industrial, Agricultural, China Construction, and Bank of China—account for nearly 70%, indicating intensified head effects. Meanwhile, small and medium-sized banks abandon all-in-one strategies, instead building “moats” in niche areas through rapid response and customized services. This industry segmentation and reorganization are inevitable results of ecological evolution in the digital age.

Open API-Driven Scenario Finance and Ecosystem Coexistence

First, the technological foundation and standards game of open banking. Open banking is a key pathway for reconstructing the financial ecosystem. Its core lies in encapsulating the bank’s underlying service capabilities into standardized modules via APIs and delivering them to third-party partners. To avoid “data silos” and interface chaos, regulators and industry organizations are vigorously promoting API standardization from 2024 to 2025. The People’s Bank of China’s “Regulations on the Security Management of Commercial Bank Application Programming Interfaces” will be more widely applied by 2025, clarifying norms and security requirements for financial applications of cloud computing technology. The China UnionPay open platform continues to update its OpenAPI gateway, releasing the 2024 standard statement to promote standardization of cross-border business authentication and merchant onboarding interfaces. Building and improving this standardized infrastructure paves the way for seamless interconnection among different financial institutions and tech companies, enabling financial services to be flexibly “assembled” like building blocks.

However, open APIs also mean that banks’ security boundaries extend from internal LANs to the uncontrollable internet environment, making security and trust reshaping prerequisites for ecosystem cooperation. The practice of global payment giant Stripe shows that the security of open banking must be based on strong customer authentication (SCA) and tokenization technology. When users authorize third-party applications to access their bank accounts, they no longer provide passwords but instead obtain a time-limited, permission-controlled token via API. This mechanism safeguards data privacy while enabling data portability. Only by solving security and trust issues can open banking truly move from concept to implementation, becoming the capillaries connecting finance and the real economy.

Second, “technology flow” and “green flow”: deep cultivation of vertical ecosystems. Supported by open APIs, commercial banks no longer pursue large, all-encompassing traffic portals but instead focus on deepening specific industry ecosystems, building competitive advantages through unique data models. In fintech, some banks have broken the inertia of traditional credit evaluation based on financial statements, innovatively introducing “technology flow” evaluation systems. These systems systematically assess non-financial indicators such as intellectual property quantity, patent quality, R&D team strength, and industry-university-research collaborations, quantifying them into credit basis. To obtain these data, banks connect via APIs to government data sources like the State Intellectual Property Office and the Torch Center of the Ministry of Science and Technology, even using satellite remote sensing images to evaluate agricultural tech startups’ assets, achieving notable results. Through data ecosystem cooperation, banks can effectively identify and serve “high-risk” clients in traditional risk control, delivering financial resources precisely to the roots of technological innovation.

Similarly, under the goal of “dual carbon,” the digitalization of green finance is forming a closed loop. The challenge lies in quantifying and monitoring environmental benefits. The Green Finance Information Management System established by the Huzhou branch of the People’s Bank of China, through interface upgrades, enables full reporting and statistics of green credit data within the jurisdiction. A commercial bank, relying on the “Banking + Platform” model, has created dedicated financing channels for distributed photovoltaic projects, achieving the first carbon emission-linked loan and green certificate-linked loan; its API directly connects to enterprise carbon monitoring systems, with loan interest rates dynamically adjusted based on emission reduction performance.

Third, embedded finance: from “traffic monetization” to “full lifecycle services.” Embedded finance is an advanced form of open banking, making financial services “invisible” and integrated into non-financial scenarios, enabling a leap from traffic monetization to full lifecycle services. In elderly care finance, as China’s aging society advances, single pension products can no longer meet needs. China Life, through an “insurance + services” model, has built a three-in-one elderly care ecosystem integrating institutions, communities, and home-based care.

For small and micro enterprises, embedded finance not only solves financing difficulties but also lowers operational thresholds. The World Bank pointed out that e-commerce platforms like MercadoLibre and Alibaba leverage merchants’ transaction and logistics data on their platforms for direct credit. In this model, credit is no longer a separate approval process but an “instant option” within supply chain procurement. This scenario-based, seamless credit greatly reduces transaction costs, expands financial service coverage, and demonstrates the huge potential of digital finance in inclusive finance.

Risk Prevention and Future Outlook under the “Five Major Regulatory” System

First, the full implementation of RegTech and the “Five Major Regulatory” concepts. As the financial service ecosystem transforms, traditional institution-based regulation faces great challenges. The “Five Major Regulatory” approach—covering institutional, behavioral, functional, penetrative, and continuous regulation—addresses new risk forms. Among these, penetrative regulation is key to managing layered, hidden risks in an open environment. Regulators continuously upgrade on-site inspection analysis systems (EAST), utilizing big data and AI to penetrate complex ownership structures and fund flows, identifying potential related-party transactions and benefit transfers. In 2025, some provincial financial regulatory bureaus held EAST system penetration modeling competitions to cultivate versatile regulators who understand both code and business, marking a fundamental shift from “bookkeeping” to “model running and data checking.”

The digital tools of regulation are also reflected in practical cases. For example, in supervising listed companies’ financial fraud, regulators used penetrative methods to deconstruct a four-year fraud chain, holding the actual controllers and intermediaries accountable. Additionally, the Supreme People’s Court emphasizes ensuring that financial regulatory measures are “long-armed and effective.” By establishing a case database, over 130 financial-related cases—covering banking, securities, and insurance—have been recorded, standardizing judgments and providing clear rules for the market. This judicial-regulatory synergy offers a solid legal foundation for dispute resolution and risk management in the open financial ecosystem.

Second, new risks and prevention in an open environment. Although open APIs improve efficiency, they may also introduce external risks. If embedded e-commerce platforms or SaaS providers experience data breaches, risks can quickly propagate to the banking system. The “Plan” emphasizes “digital risk prevention,” requiring banks to establish strict access mechanisms and real-time risk monitoring when cooperating with third parties. Balancing value extraction and privacy protection in data element development remains a challenge. Banks need to adopt privacy computing, federated learning, and other technologies to enable joint modeling without data leaving the domain, ensuring data security.

Looking ahead, from 2026 to 2030, China’s financial service ecosystem will become more intelligent. According to KPMG, generative AI will evolve from an auxiliary tool to a core decision-making resource. Future banking apps may disappear, replaced by dedicated “Financial AI Assistants.” These agents will connect via APIs to various life services and investment products, automatically managing asset allocation, liquidity, and risk hedging.

The reconstruction of the financial service ecosystem in the digital age is a comprehensive transformation involving technological architecture, business models, and regulatory logic. From the top-level design of the “Plan” to micro-practices of some banks’ “technology flow” and the institutional safeguards of the “Five Major Regulatory” system, China’s financial industry is undergoing a profound metamorphosis. Only by embracing openness, breaking down “walls,” deepening scene integration, and leveraging data elements to meet real economic needs can financial institutions secure their footing in the new industry landscape.