Survival Battle? —Traditional Banks’ Strategic Choices In The Internet-financial Environment

In the 21st century, the rapid development of Internet technology has greatly changed the way information producing and transmitting, reduced the economic costs of information gathering activities, and also greatly changed the behavior of economic activity. That the number of Internet users nationwide is constantly refreshing and the e-commerce transactions is continuously growing entitle us to see the new technology is bringing to the explosive Internet economy and a huge market. The development of the Internet economy brought about the innovations in the traditional settlements, combined with the relatively loose regulation on the economic controlling of emerging industries, lead to that a large number of third-party payment companies is flooding the e-commerce market. The efficiency and convenience of the Third-party Payment greatly meet the consumer’s comprehensive needs. This innovative ways for settlement of transactions formatted an unprecedented impact on the traditional commercial banking which once had a monopoly position. Internet financial enterprises such as the Third-party Payment have a keen sense of market demand and a innate ability to innovate for Internet banking, they are constantly making breakthrough in the field of consignment, financing and something else. The business and profit model and the credit evaluation system of traditional commercial banking are experiencing the impact and challenges which led the market to re-examine the concept of traditional finance and even some people think that the traditional commercial banks, like "the 21st century dinosaurs", will demise.This paper has an objective analysis of the traditional commercial banks and third-party payment companies, focusing on their respective strengths and weaknesses. We can see that the Internet-based financial companies did not imagine so perfect, they have certain limitations in customer base and the database classes, over rely on bank account entity, and influenced by the policy greatly. The traditional commercial banks still have the brand and scale advantages, as wellas a more complete risk assessment system. This paper says that the traditional commercial banks will survival the dispute referring to a number of foreign literature as well as the development of electronic money in the United States. Of course, the traditional commercial banks should actively face the changing business environment, adhere to customer demand as the core operating principles when facing the changes of consumer behavior, thus to choose their own unique Internet-based financial strategic direction.This paper brings about some strategic choices for commercial banks in their development of Internet-based financial sector, taking the status of the Internet finance into account. Traditional commercial banks should maintain good relations with the Internet financial companies, represented by Third-party Payment, with an open mind, to create a good electronic ecosystem and industrial chain. In addition, commercial banks should increase the technical inputs and efficiently adapt to the changes in the operating environment which derived from the new technology, and then strive to maintain a competitive and dynamic identification advantage and ultimately to promote the healthy development of the financial market.