Emergence And Evolution Of Internet Finance:innovation And Its Mechanism

Internet Finance combines the financial industry with Internet industry,based on Internet technology platform to provide financial services across time and space,which reflects its financial essence.Internet Finance effectively expands the diverse choosing rights of financial participators in financial transactions,and reduces costs of financial transaction,with full use of Internet technology based on transparent information,high efficiency,Big Data and cloud computing.Internet Finance starts from 1990 s and develops rapidly at the early 21 st century,besides it is known as "the first year of Internet Finance " in 2013.The innovative development of Internet Finance has attained the focused attention from government departments, academics, public investment and financing area.First,this paper analyzes Internet Finance’s evolution process and its different characteristics.It is divided into three stages,which are traditional finance being online,new online finance means and real Internet Finance.The conclusion is that the third stage doesn’t exist at present,and the first stage doesn’t end competing with the second stage.Secondly, through analyzing the evolution process of Alipay, Internet Finance typical representative, this paper summarizes four typical factors of Internet Finance,namely institution,market structure,technology and organization mechanisms,and then builds the analytical framework of Internet Finance.The conclusion is that institution is a core factor and the guarantee of Internet Finance enduring and steady development,that market structure,technology,and organizational mechanisms do an important impact on Internet Finance but also induce financial institution development to regulate Internet finance and protect all sides interests.Thirdly,through making theory and facts explanation of the interaction between the Internet Finance and its four key factors,this paper proves that the institutional development is an institutional guarantee of Internet Finance sustainable and healthy development,that market structure plays a decisive role on Internet Finance survival space,that technological progress is a incentive and technical support for Internet Finance,that collaborative development of organizational mechanism is the highest development level of Internet financial.Finally, we believe that Internet Finance innovation and "catfish effect" isexpected to cure the financial system solid disease, to effectively serve the real economy and people’s livelihood.The reasons are as follows.Internet Finance brings logistics, capital flow, information flow together,which is good to build a perfect social credit system.Internet Finance unites the payment interface of different bank and real economy,which promotes systemic effects.Internet Finance breaks the almost sole pattern of bank credit, and strengthens the direct financing position standing for market credit.High penetration and wide coverage of Internet Finance is expected to exceed the separate management system,achieving a financial system of combination mixed operation with corresponding functional regulation.This paper’s innovation is summarizing and analyzing the key factors of Internet Finance by analyzing the typical case,and supports the views with theory and facts.Short of data,this paper can not construct an empirical model,which is the direction of the future research.Key words:Internet Finance;Four dimensions;institutional innovation;evolution...