China's AI objectives for finance outlined at Beijing conference

China aims to advance the application of artificial intelligence in finance in a safe and orderly manner during the 15th Five-Year Plan period (2026-30), accelerating the establishment of a modern financial system that aligns with the development of the intelligent economy, a central bank official said on Sunday.

Li Wei, head of the Technology Department of the People's Bank of China, said at the annual conference of the China Wealth Management 50 Forum that the significance and capability boundaries of artificial intelligence must be fully recognized.

Li said China intends to formulate a new-stage financial technology development plan, with a focus on deepening AI applications as a core aspect, during the 15th Five-Year Plan period.

Policies for the prudent application of AI in finance will be developed, clearly defining the overall objectives, key tasks and main directions. Efforts will also be made to accelerate the construction of national AI industry application pilot bases in the financial sector, lowering the costs of industry model training and the barriers to application innovation, he said.

Li added that the formulation of security norms for the financial application of large AI models will be explored, while the ethical governance model for AI technology in finance will be enhanced. There will also be an emphasis on categorizing and grading risks in AI applications and managing the admission of high-risk applications.

Promoting the healthy development of "AI plus finance" requires balancing innovation and regulation, as well as efficiency and safety, said Shang Fulin, chairman of the China Wealth Management 50 Forum and formerly top regulator of China's banking and securities sectors.

On the one hand, financial institutions should be encouraged to actively explore AI application scenarios in compliance with laws and regulations, driving technology to better serve the real economy and technological innovation. On the other hand, the data governance system, internal control processes and risk prevention mechanisms should be improved simultaneously. The system constraints and capacity-building for key links must be strengthened to ensure that AI plays a role in a controllable, trustworthy and sustainable manner, effectively safeguarding financial security, Shang said.

The application of AI in the financial sector still faces many issues that need to be addressed carefully, he added. AI is highly dependent on data and algorithms, and if the data sources are non-compliant or decision-making logic becomes a "black box", it is easy to exacerbate information asymmetry and even create new risks.

Shang also warned that attention must be paid to the structural divide caused by the digital divide. While encouraging leading financial institutions to take the lead, regulators must also address the digital divide that smaller institutions may face, balancing innovation with the inclusivity of the financial system.

"AI technology is still accelerating and undergoing frequent iterations, and traditional regulatory and governance methods must continuously adapt to the new technological environment," he said.

"How to build an institutional framework and governance mechanism that aligns with digital productivity is a challenge that both regulators and market entities must jointly address."

The establishment of a Financial Investment Alliance was also announced during Sunday's conference. The alliance is a joint initiative of the National Wealth Development Research Alliance, asset investment companies, insurance investment institutions, the National Integrated Circuit Industry Investment Fund, regional industrial guidance funds and leading equity investment funds, with the China Wealth Management 50 Forum to act as a guide. The alliance aims to build a bridge between finance and industry, exploring the best means for the long-term investment of capital in support of technological innovation and industrial development.

jiangxueqing@chinadaily.com.cn