A Research On The Development Strategies Of China’s Urban Commercial Banks Under The Background Of Internet Finance

Along with the development of Internet, ubiquitous network has covered every industry which has opportunities to develop new business with Internet. In 2013, a new financial product called “Yu’e Bao” spread a new concept called "Internet finance" in China, especially in financial community. For the last two years, more and more products similar to “Yu’e Bao” had appeared, leading people to a new era of money management. P2 P network credit platform can help small enterprises solve the problems of funding without traditional financial intermediaries. The third-party payment platforms, accepted by Central Bank, are developing very fast in China. During the Spring Festival of 2015, electronic money replaced traditional red envelopes as a new way to give “lucky money”. The electronic money was sent by a mobile application called “Wechat”, which made more of 200 million bank cards bound with Wechat. However, this effect took Alipay eight years. These new products were all born of Internet, and all of them attracted the governments’ attention.Nowadays, a variety of financial innovations has appeared like ‘Internet finance’, and affected traditional financial fields such as financial payment, financing and financial management. It is a new business model and profit model which will influence the leading role played by banks. In the 1980 s, Bill Gates said “if traditional Banks are not improved, it will be disappeared in the 21 st century.” Today, the development of information technology, such as Internet and mobile phone, changes our lifestyle. Because of Network, a lot of traditional products, such as tapes and photographic film gramophone record, will be out of date. Meanwhile, in the digital era, commercial banks should provide the financial services through the Internet, looking for a new way to develop. As Regional Small and Medium Banks, Urban commercial Banks have not been well developed since it was first established. After continuous development, they work well. Now, each big commercial Banks takes the initiative to develop the Internet financial products. And China Banking Regulatory Commission has forbidden urban commercial Banks to open new branches in other cities. Facing with such a situation, urban commercial Banks should take measures to execute sustainable development. For example, they could provide services and sell financial products for people online, so the policy restrictions would not affect them.The paper first clarifies the connotation, the main body and the causes of the Internet finance, and then analyzes the development of the Internet finance and the main modes. So we can realize that the Internet finance brings traditional banks both opportunities and challenges, though the opportunities outweigh the challenges. Therefore, under the review of our country city’s development history, I find its specific development characteristics. Through collecting statistical data from CBRC Website and annual reports of several banks, and according to the relevant financial indicators, I objectively analyze the development situation of urban commercial Banks in recent years. From the perspective of enterprise strategic management theory, SWOT is widely used in competitive analysis and strategy by companies. So I use it to analyze the internal factors of city banks more impersonally and accurately which are advantages or disadvantages objective. Furthermore, we could find out the opportunities and threats coming from the Internet financial models. Next, I use analytic hierarchy process(AHP) to do the quantitative analysis of the strategic factors systematically. The strategic factors are the results of the SWOT qualitative analysis. As a result of overall processes, the strategic decisions are scientific and available. Finally, based on the SWOT strategic combination and the principle of adjust measures to local conditions, I put forward several countermeasures. For examples, the SO strategy is relatively suitable for the urban banks which located in the city with advantages of the information and financial resources. ST and WT strategy are well suited to the growing of medium-sized city banks. WT defensive strategies are good for some banks in the Midwest, which can be used to find new ways to compete. In a word, the one purpose is to develop the core competitiveness of China’s city commercial banks and implement the sustainable development.