The country is close to launching the coverage that could open up free competition by banks for customers.
China is drawing ever closer to the launch of a bank deposit insurance system that has long been anticipated but that has yet to have been accomplished, and that could completely overhaul that country’s financial sector.
This change could hike the risk level in the banking sector and could make it possible for immense future opportunities.
By introducing a system of bank deposit insurance, it could mean that there may one day be the opportunity for those financial institutions to be able to compete for depositors. A number of top officials from the branches of the central bank in China, the People’s Bank of China, were in attendance at a conference that took place at that institution’s headquarters in Beijing. There, they talked about the various details that are involved in the implementation of this type of insurance plan, according to sources that are close to this matter.
It is now believed that the China bank deposit insurance plan could launch as early as January 2015.
Officials have revealed that at the launch of the insurance plan, it would insure accounts up to a limit of approximately $81,000 (500,000 yuan). Industry experts agree that this step would become the most important economic move that has occurred under China’s president, Xi Jinping, in the two years since he rose to the top of the ruling Communist Party.
This is one move in a wider series of economic policy changes that lean to a far more liberal side than has been the tradition in the country. This has also included the broadening of the trading regulations with regards to the yuan, which is heavily controlled, as well as the permission of more foreign stock investment within China.
An official has stated that there will be an announcement made very soon with more details about the bank deposit insurance that is coming to China. Hu Xiaolian, a vice governor of the People’s Bank of China, recently said that the financial institution is “speeding up” its efforts to put the system into place.