Chief Technology Officer | Dialogue with Suning Bank Huang Jin: Digital Development Strives for "Autonomous and Controllable" New Technology Applications Need to Solve Bank's Practical Problems

21st Century Economic Reporter Chen Zhi reports from Shanghai

With the increasingly integrated development of technology and finance, how small and medium-sized banks can use technology to empower them to create differentiated business development strategies and business competitiveness has attracted market attention.

Recently, Huang Jin, the Chief Information Officer of Jiangsu Suning Bank, stated in an interview with our reporter that since its inception, Jiangsu Suning Bank has been committed to building an "O2O" financial service system driven by technology, focusing on the "gap" business in the market, and making inclusive finance such as WeChat Finance, Industrial Chain Finance, and Consumer Finance as its core businesses, striving to find a differentiated development path.

In his view, the transformation that technology empowers banks lies not only in the innovation of digital products and services and the improvement of customer experience, but also in the continuous optimization of internal management efficiency of banks.

Through technology empowerment, Jiangsu Suning Bank is now able to understand the daily workload of each employee and the latest communication progress of business departments, which helps improve the market reaction speed and business innovation pace of Jiangsu Suning Bank, and better respond to the rapidly changing market environment. "Huang Jin pointed out to reporters.

It is worth noting that with the emergence of AI big model technology this year, more and more banks are testing the application of big model technology, and Jiangsu Suning Bank is no exception.

Huang Jin told reporters that Jiangsu Suning Bank has currently applied big model technology to intelligent customer service scenarios and will further promote it to fields such as auxiliary research and development, text generation, collection, and intelligent investment advisory in the future.

The reporter learned that as more and more banks carry out research and development of large models, some experts are concerned that if the content generated by bank large models is highly "homogenized", it can easily lead to waste of data and computing power. Especially in terms of computing power, the average annual investment of each bank reaches millions of yuan, which may result in a huge waste of financial resources.

Huang Jin believes that the research and development direction of big model technology may vary among banks due to different business scenarios. However, to reduce the resource waste caused by the "homogenization" of big model generation content, relevant departments may establish an authoritative organization to integrate various data and computing resources for big model research and development. Banks will then "use" big model technology according to their own business needs, Perhaps it can achieve twice the result with half the effort.

The Challenge and Breakthrough of the Digital Journey

21st Century: How did Jiangsu Suning Bank plan its digital development direction and implementation path?

Huang Jin:Since its inception, Jiangsu Suning Bank has embarked on a digital journey, fully leveraging technology to enhance business efficiency and service experience, striving to achieve the mission of "technology makes finance simpler".

Regarding the development direction of digitalization, Jiangsu Suning Bank has identified two directions: firstly, independent and controllable technology, which can be independently researched and developed by us; The second is to focus on technologies that can greatly enhance business efficiency, such as big data risk control and artificial intelligence. In recent years, we have invested significantly in these financial technology fields.

At present, we feel that these technological investments have brought considerable 'returns'. Firstly, Jiangsu Suning Bank has accumulated vast amounts of data and formed digital assets, organizing numerous business processes such as marketing management, customer management, product design, process design, employee management, and execution management through digital means, transforming them into front-end product services for customers and employees, continuously improving the financial service experience and customer satisfaction; Secondly, digital technology has brought significant cost reduction effects to banks. Currently, the cost to income ratio of Jiangsu Suning Bank is 21.93%, supporting us to carry out differentiated development strategies and expand and strengthen sub market businesses such as small and micro inclusive services.

21st Century: What are the main challenges faced by Jiangsu Suning Bank in the process of digital development? How to solve it properly?

Huang Jin:The challenges encountered in the digital development process of banks are multifaceted. For small and medium-sized banks, some challenges are particularly prominent.

One is the challenge of cultivating and recruiting financial technology talents. Unlike the gathering of numerous financial technology talents in the "Beijing, Shanghai, Guangzhou, and Shenzhen" region, Jiangsu Suning Bank not only needs to independently cultivate and retain financial technology talents, but also strives to attract some top talents to join. When recruiting specific talents with high levels of financial technology research and development, we need to offer a "considerable salary".

The second challenge is the quality and accuracy of data. Data quality and accuracy have always been key to the digital transformation of banks, but banks often have some problems in data collection, storage, and use, such as inaccurate, missing, and duplicate data. In order to address these issues, Jiangsu Suning Bank has been committed to strengthening data governance, establishing a comprehensive data quality monitoring and verification mechanism, and strengthening data source control to ensure the accuracy and completeness of data.

The third challenge is the technical architecture and system stability. With the acceleration of digital transformation, Jiangsu Suning Bank also faces challenges in terms of technical architecture and system stability. To address these challenges, Jiangsu Suning Bank needs to continuously strengthen its technological research and investment, adopt a highly available technical architecture and backup solution, and strengthen system monitoring and maintenance to ensure system stability and reliability.

The fourth challenge is data security and privacy protection. With the increasingly strict regulation of data security protection by the country, the challenges of data security and privacy protection are becoming increasingly prominent. Jiangsu Suning Bank needs to strengthen measures for network security and privacy protection, adopt a multi-level security protection system and encryption technology, and strengthen employees' security awareness and training to ensure the security and privacy protection of customer information and transaction data.

Large model applications focus on "practical orientation"

21st Century: Since the beginning of this year, AI big models have suddenly become the "hot vocabulary" in the journey of bank financial technology innovation. How does Jiangsu Suning Bank layout the application of AI big models in scenario financial services? Which business scenarios will AI big model technology be introduced as a priority?

Huang Jin:Since the beginning of the year, we have noticed the rapid rise of AI big model technology, and we have determined that AI big models will play a role in reducing costs and increasing efficiency in many banking business scenarios. Therefore, we established a bank level financial big model project team and selected a group of personnel with strong technological research and development capabilities and active business thinking to jointly study how to better apply AI big models in banking business scenarios.

At present, we have taken the lead in applying AI big model technology to intelligent customer service scenarios, as it can significantly improve the intelligence level of online Q&A for bank intelligent customer service. In addition, we are developing the application of AI big models in the auxiliary research and development and text generation stages. The former can assist bank research and development personnel in writing code, and carry out some automated tests to improve the research and development efficiency of business digitization; The latter can improve the efficiency of bank personnel writing reports and help improve communication efficiency within the bank.

In the future, we will also try to apply AI big model technology to scenarios such as collection and intelligent investment advisory. For example, in the collection process, we can use large model technology to "analyze" the communication information between banks and overdue lenders, assess the latter's repayment willingness, and serve as an auxiliary tool for optimizing collection strategies; In the intelligent investment advisory scenario, we can also use large model technology to analyze the communication information between banks and clients in wealth management, analyze the investment needs of the latter, and provide valuable investment advisory suggestions.

In fact, for the application order of AI big models in business scenarios, we will adhere to a principle of prioritizing the application of big model technology in those scenarios that can help banks effectively solve the pain points of financial services. We will not introduce big model technology to "catch up with the trend", but to require it to truly solve the practical problems of banking business development.

21st Century: Since the beginning of this year, many banks have increased their research and development investment in AI big model applications. Will this lead to a decrease in banks' research and development investment in blockchain, metaverse, and other new technologies? How does Jiangsu Suning Bank allocate its investment in various financial technology research and development?

Huang Jin:Whether it is the AI big model, blockchain or metaverse, Jiangsu Suning Bank's investment in the research and development of these new technologies only follows one principle, which is whether it has practical application scenarios to help banks effectively solve business pain points and achieve cost reduction and efficiency improvement goals.

At present, we have made breakthroughs in blockchain+finance. For example, under the guidance of the Jiangsu Branch of the People's Bank of China, Jiangsu Suning Bank has led the development of the "Jiangsu Anti Money Laundering Attention Information Blockchain System" to solve the problem of anti money laundering information silos between institutions. Currently, more than ten banking institutions in Jiangsu Province have connected to the system, improving the overall level of money laundering risk prevention. This system has been selected as a pilot demonstration project for the development of the blockchain industry in Jiangsu Province. For example, the "blockchain+Internet of Things" movable property pledge financing system independently developed by Jiangsu Suning Bank has solved the risk control problem of movable property pledge. Relying on a good level of movable property pledge management, the overall non-performing rate of this business is controlled within 0.2%. At present, based on core intellectual property technology, we have achieved cross warehouse supervision for the same customer. Not only can we achieve inventory pledge financing for steel trade, non-ferrous metals, automobiles, coal, etc., but we can also expand the scope of movable property pledge targets to household appliances, 3C and other household equipment, as well as fast moving consumer goods such as drinking water and cosmetics, further simplifying the online financing procedures for enterprises, and achieving "loan upon delivery, loan upon return", Save 1 percentage point in corporate financing costs, effectively solving the financing difficulties and high financing costs of small and medium-sized enterprises.

In terms of the metaverse, we have attempted to investigate whether the "immersive experience" of the metaverse can further improve the efficiency of online financial business processing and customer service experience. At present, through a period of research, we have found that some technologies are still quite "advanced" and have not yet found suitable banking service scenarios.

So, we still need to adhere to the concept of "spending money on the cutting edge", as long as the new technology skills effectively improve the efficiency of scenario financial services and effectively solve business pain points, we are willing to increase investment.

The "Balance" and "Assessment" of the input-output Ratio of Scientific Research

21st Century: You just mentioned "spending money on the cutting edge". What pain points and bottlenecks have Jiangsu Suning Bank's research investment in recent years solved in its business expansion process?

Huang Jin:Jiangsu Suning Bank vigorously develops digital technology, which makes it easier for customers to use and easier for employees to operate. Our positioning is as a "technology driven O2O bank", focusing on the integration of online and offline development, actively integrating into industrial scenarios, transaction scenarios, consumer scenarios, and vigorously developing scenario finance.

In this process, the main pain points and bottlenecks faced by banks come from two aspects: firstly, in terms of customer acquisition channels, it is difficult to reach customers and the efficiency of offline risk control material collection is low; It is difficult to identify customers through data risk control, and there are many people, enterprises, materials, and market risks in industrial scenarios. Pure data risk control is difficult to support; It is difficult to comply with online operations, and the traditional online and offline separation of exhibition models has problems such as lack of information and high operational risks; The operation of existing customers is difficult, with high operating costs, and there is an urgent need for risk management capabilities throughout the entire lifecycle.

Secondly, in terms of customer marketing, it is manifested in weak customer insight ability, that is, banks are relatively backward in the application of data asset scenarios, and there are situations where they underestimate customer experience, stickiness, and demand satisfaction, making it difficult to effectively identify unmet customer needs; Insufficient collaboration between businesses and channels, resulting in duplicate marketing in various business areas and low marketing efficiency, which can easily lead to poor user experience; Insufficient data analysis capabilities, facing massive amounts of user behavior data, lacking strong data analysis capabilities, etc.

In response to these business pain points and bottlenecks, Jiangsu Suning Bank has made multiple business reforms through technology empowerment. For example, we have launched remote banking services, utilizing video service technology, voice recognition technology, OCR recognition technology, and other technologies. While strictly adhering to security, we have opened our business hall on the "cloud", allowing customers to enjoy the bank's "face-to-face" online financial services without leaving their homes, Optimized the banking business process and provided convenient intelligent services to customers.

At the same time, based on the digital model of "data+algorithms+platforms+operations", we attempt to introduce intelligent marketing methods, transforming batch based marketing activities into normalized daily automated marketing, achieving model based customer lifecycle management, and striving to improve the efficiency and accuracy of business marketing.

21st Century: Due to the impact of the economic environment, banks are also committed to reducing costs and increasing efficiency, and pay more attention to the "input-output ratio" of scientific research investment. How does Jiangsu Suning Bank achieve a balance in terms of investment and output in digital technology research and development? How do banks assess the input-output of digital technology research and development processes internally?

Huang Jin:The evaluation of input-output ratio around digital technology needs to be comprehensively balanced from two aspects. Firstly, the establishment of a technology bank is a major development strategy of Jiangsu Suning Bank. At the strategic level, banks need to make strategic investments in technology research and development, including system upgrades and new technology application attempts, to consolidate their advantages in financial technology; At the specific business operation level, we will maintain close communication with the business department. In fact, many of our digital product services stem from the specific business needs of our business departments. Based on these business needs, the technology department evaluates the approximate investment in technology research and development and the expected results. After obtaining approval from the bank's senior management, relevant digital product service research and development work is implemented.

At the same time, we will continue to track whether the actual R&D costs and effectiveness of these digital product services have met expectations. If the actual costs are too high and the effectiveness is not significant enough, we will also adjust our strategies in a timely manner.

At present, in order to promote the further integration of technology research and development with business needs, many business departments in the industry also have their own research budgets and KPI assessment methods. When using these research budgets to enable us to develop digital product services, business departments will also rate our delivery costs, delivery efficiency, delivery quality, and other aspects, thereby promoting better synergy between each other.

If some digital products and services achieve better than expected results, banks will also reward relevant scientific research personnel, forming a positive incentive mechanism.

Over the years, one of my most obvious feelings is that with fierce market competition, the biggest demand from business departments to technology departments is "fast" - to deliver digital products and services as soon as possible, because when you slow down a bit, you may lose your key market first mover advantage. Therefore, we are also trying to promote "technology forward" by placing some scientific researchers on the front line of business and quickly responding to the new needs of business departments.

Four major upgrade directions for domestic software and hardware

21st Century: We have noticed that another reason why banks continue to increase their research investment is the "provocation" against mafia and financial fraud organizations. Especially in recent years, the technological capabilities of these black industry fraud organizations have been increasing. How can banks use technology as a card to "resist the enemy"?

Huang Jin:The struggle against mafia and financial fraud organizations is a long-term process. In recent years, we have indeed seen the technological capabilities of certain black production organizations improve, and even some facial recognition technologies have been "breached" by them. This means that facial recognition can no longer be the only customer identity verification tool for banks, but can only be used as an auxiliary verification tool. In this situation, banks need to fully leverage new technologies such as big data analysis to construct multi factor customer identity verification methods.

In addition, banks need to further strengthen internal management through technological means to prevent data leakage.

In fact, many black industry organizations are also using big data models to fabricate a large amount of customer information and apply for loans for "trial and error", with the aim of capturing the "loopholes" in bank credit risk control. Only by better utilizing new technologies and continuously and rapidly iterating their own credit risk control rules can banks increase the "trial and error" cost of black production infinitely, forcing them to "retreat from difficulties". Only in this way can banks truly "resist enemies thousands of miles away".

21st Century: In recent years, relevant national departments have required financial institutions to actively use domestic software and hardware. How is Jiangsu Suning Bank currently progressing in this regard? In order to better support the business development of domestic financial institutions with domestic software and hardware in the future, what further improvements are needed?

Huang Jin:Since its inception, Jiangsu Suning Bank has comprehensively promoted the localization of software and hardware. At present, we have achieved 100% localization in computer equipment, security equipment, domain name resolution equipment, routers, and other areas have also reached a high level of localization. Especially in terms of challenging virtualization software, this year we have completed the 100% localization construction of the container platform, and have also started pilot applications in database replacement.

At present, domestic software and hardware mainly need further improvement in four aspects: software and hardware ecology, stability, performance, and compatibility. Specifically, there are four aspects: firstly, the software and hardware ecosystem is insufficient to achieve large-scale and widespread application, and there is no mature upstream and downstream software and hardware support for the entire ecosystem. Secondly, the stability is relatively weak, such as a high failure rate of software and hardware; Thirdly, there are certain deficiencies in performance, such as the system being prone to some uncertainties during prolonged high water level operation, resulting in weaker performance indicators; Fourthly, compatibility is still slightly weak, as the differences in the operating environment of banking systems often lead to certain compatibility issues, such as inability to work or abnormal exit.

But I think the main reason behind this is that the research and development practice time of domestic software and hardware is relatively short. If given time, more and more domestic financial institutions are increasing the scope of domestic software and hardware usage and promoting the latter to continuously iterate and upgrade, domestic software and hardware will sooner or later break through these bottlenecks and become the "new infrastructure" for business innovation of banking and financial institutions.

In the future, Jiangsu Suning Bank will continue to comprehensively promote the localization of software and hardware, firmly believing that the breadth and depth of use of domestic software and hardware will continue to strengthen, and will soon reach the world's leading level.