Research on Risk Assessment and Control of Internet Finance in China

Internet finance is advantageous to improve financial market competition, enhance capital allocation efficiency and decrease financial service costs. Moreover it makes up the deficiencies of the traditional finance on the aspects of satisfaction of the wider populations on financial demands, enhancement of financial inclusiveness and improvement of financial service efficiency. However Internet finance is also a double-edged sword. As a new pattern and new mode in the financial field, the prevailing laws, policies and regulatory systems can not completely cover the risk vulnerabilities of internet finance. This paper adopted the fuzzy analytic hierarchy process and five quantitative representative influential factors to compare the risk. According to the empirical analysis, the first higher risk in the current internet finance of China is credit risk; following which, the risks are the business risk, legal risk and operational risk; therefore it is very necessary to launch effective regulation and supervision on the risks of Chinese internet finance from multiple aspects, such as credit system, laws and regulations, regulatory systems so as to promote the mutual development of internet finance and traditional finance; this is the core issue of Chinese internet finance development.