Since the end of 2021, a number of policies have been introduced in the fintech sector, including the Fintech Development Plan (2022 - 2025), the Guiding Opinions on the Digital Transformation of the Banking and Insurance Industries, and the 14th Five-Year Plan for the Technological Development of the Securities and Futures Industries. These policies reflect on the results that have been achieved over the last five years in reinforcing the foundation and framework of fintech, while also serving as a rallying call for the market to embark on a new stage of fintech development. As suggested in the Plan, technology-empowered financial resources should be precisely allocated to key areas and weaker aspects of economic and social development, so that the financial sector can better serve the real economy. Digitalised, fintech-based financial infrastructure is an indispensable part of "new infrastructure"; and the stronger it is, the smoother and more efficient the financial system runs as a whole and the more reasonable financial resources are allocated. 

The new information technologies, particularly the ABCD technologies, have been proven effective after years of trials and testing. The stable developmnt of mature technologies is empowering financial data centres and computing power centres and opening up comprehensive financial scenarios. In general, technology is causing the financial sector to shift from "model innovation" towards "technological innovation," while also laying a solid foundation for financial infrastructure. 

Financial enterprises are becoming more open and responsive as they pursue their digital transformations, but risks in business, technology, data, networks and other areas are emerging alongside these changes. Digitalisation is accelerating the upgrading of financial products and services, but it is also resulting in new financial risks that pose challenges to traditional regulatory policies and tools. In 2022, China introduced a number of high-level financial and data regulations to lay a more robust institutional foundation for the financial system. Specifically, in October, the People's Bank of China issued the Guidelines for Science and Technology Ethics in the Financial Sector, which provides policy guidance in response to ethical issues related to the digital divide, technological exclusion, algorithmic discrimination, privacy violations and other challenges. In December, the State Council issued the Opinions on Establishing an Institutional Foundation to Better Maximise the Role of Data Elements, which is the first issuance to describe the basic rules for data and specify principles and guidelines for handling data property rights, data circulation, data transactions, data use, data distribution, data governance and data security. Data is widely circulated in the financial sector, and the 20 Data Measures clearly specify how data property rights, data circulation, data transactions, and income distribution should be handled. 

Institutions are just as important as technology when it comes to forming a solid foundation for the long-term development of the fintech sector, especially in view of the dual role played by institutions as both a motivator and constraint. In recent years, the development of legal frameworks, regulations, industry standards and self-disciplinary rules have accelerated the formation of a multi-layered system of fintech rules and regulations. 

As the payments market matures and regulatory policies are refined, the payment sector is gradually moving from unruly growth to high-quality developmnt. The application of AI, big data, blockchain, and privacy computing, among other technologies, by enterprises in the payment sector is enhancing payment efficiency, promoting data multiplication and generating more value from payment data elements.

Policy suport for the expansion of cross-border e-commerce pilot schemes and cross-border payment business has presented new opportunities to cross-border payment business. In February 2022, the State Council agreed to set up integrated cross-border e-commerce pilot zones in 27 cities and regions, including Ordos, in order to expand the cross-border e-commerce pilot programme. In June 2022, the central bank issued the Notice on Supporting Cross-border RMB Settlement for New Forms of Foreign Trade, extending the payment scope of payment institutions from products and services to items in the current account. This policy has widened the scope of cross-border payment business and opened up a new market for the industry. Cross-border payment systems that incorporate technologies such as AI, blockchain and big data can reduce manual processing, shorten settlement times and improve payment efficiency. Notably, the security of cross-border payments has come to the fore amidst geopolitical conflicts, and as a result countries are focusing on the autonomy, security and independence of their cross-border finance flows. In addition, some countries and regions are building diversified regional cross-border payment infrastructure. Against this backdrop, cross-border payment institutions should pay attention to security issues when conducting offshore business and prepare contingency plans for any problems that may arise. 

The 14th Five-Year Plan for the Development of the Digital Economy, which was released in early 2022, states, "The digital economy will start to fully expand in 2025, at which time its core industries should account for 10 percent of gross domestic production (GDP)." Amid the rapid development of the digital economy and with the support of policies that promote interconnectivity, the closed payment ecosystem is opening up to accommodate external payment methods, such as Alipay, WeChat Pay, and Cloud Flash Pay. Interconnectivity between leading payment institutions will gradually eliminate payment barriers, end monopolies in the payment industry and improve payment efficiency. As payment data is now a "factor of production," payment giants are leveraging the multiplier effect of data and fully tapping the value of payment data elements in an effort to promote interconnectivity and adapt to the digital economy. 

The e-CNY plan has been launched, and regulators are actively promoting the e-CNY, resulting in an expanded e-CNY pilot scheme and richer application scenarios. The e-CNY can now be used in consumer scenarios covering people's livelihood, clothing, shelter and transportation; in business scenarios covering bill discounting, green credit and supply chain finance; and in government-related scenarios covering provident fund payment, government subsidies and taxation. At this point, the stability of the e-CNY system and the scenarios in which the e-CNY can be used have been effectively verified. Going forward, efforts will focus on expanding scenarios and constructing the e-CNY system. Enterprises can use smart contract technologies that promote consistency, observability and self-compliance to broaden use cases for the e-CNY. As the e-CNY is programmable and scalable, it can be linked to smart contracts for the purposes of conditional payments. Since 2022, e-CNY linked with smart contracts have been used to make prepayments for educational instittions, gyms, etc. to address pian points in these consumer scenarios. 

The e-CNY is also being used to make cross-border payments in international trade. The multi-CBDC (mBridge) project, which is being jointly developed by the Bank of International Settlements Innovation Hub Hong Kong Centre, the Hong Kong Monetary Authority (HKMA), the Central Bank of Thailand, the Digital Currency Institute of the People's Bank of China and the Central Bank of the United Arab Emirates, recently completed the first real-value pilot transactions using the digital currencies of four central banks. In this way, the mBridge platform allows commercial banks to complete cross-border remittances and foreign exchange operations for their customers. The pilot programme validates the feasibility of using the e-CNY to make cross-border payments for international trade settlement purposes. With richer application scenarios, a refined ecosystem and more advanced technologies, coupled with its low transaction costs and high security, the e-CNY will become more accessible and cover more transactions. In the future, it is expected to become a substitute for third-party payment methods to some extent and weaken their influence.