Study On The Efficency Mechanism Of The Internet Finance

The Internet finance is a combination of Internet industry and financial industry.It is a new industry formed by permeating the spirit of a open,equality,assistance and share" of the Internet into financial area.Internet finance develops fast these years,and showed a strong vitality.After three stages of evolution,there are four main patterns:the third payment,financing platforms,traditional financial institutions informatization and Internet financial portal.The emergency of Internet finance can make up the shortage of traditional financial institutions in allocating resources,can fill the gaps in the existing financial service.It is of great significance to the prosperity of economic and social development.In order to make the Internet finance fulfill its functions better,we should clear the concepts in two aspects.One is the function and mission of the Internet finance,and its value compared with traditional institutions.The other is its efficiency mechanism,it should be improvements of many aspects.After giving the definition of the Internet finance,this paper firstly analyses the development patterns of the Internet finance,including domestic existing pattern classification and classification in this paper based on the efficiency mechanism.Also discuss detailed operation mode of each type.Then this paper gives related notions and literature review,as well as strengths of the Internet finance compared with traditional commercial banks.After that,based on the principles of economics,such as transaction cost theory,the long tail theory,information asymmetry,scale economy and scope economy theory,this paper elaborates the improvement of the financial efficiency brought by the Internet finance in detail.Lastly,based on the summary of the study,I provide with some solutions and policy suggestions in order to solve the development problems of the Internet finance.