In 2015, amid the turbulence in domestic and global markets, the Chinese government launched a series of reforms for the financial sector.
Those reforms include lifting the cap on interest rates, reducing tariffs on certain necessities, establishing more free trade zones, reforming the domestic deposit insurance system and adjusting the yuan's exchange rate central parity system.
Although these reforms involve different areas, many follow the theme of replacing government control with a market-orientated mechanism.
Other reforms aim to further integrate China's financial system with the global economy.
"Compared with financial reforms, reforms in other sectors in China have been more or less pro forma this year," Tian Yun, director of the research center of the China Society of Macroeconomics, told the Global Times on Friday.
The Global Times spoke with three financial experts this week to ask their opinions on which of China's financial reforms they thought were most crucial in 2015.
They are Zhao Xijun, deputy director of the Finance and Securities Research Institute at Renmin University of China, Song Fengming, director of the Department of Finance in the School of Economics and Management at Tsinghua University, and Liu Dongliang, senior analyst at China Merchants Bank.
Zhao: interest rate reform
"The most representative financial reform this year was lifting the interest rate cap," Zhao said on Thursday.
The People's Bank of China, China's central bank, abolished its official cap on savings interest rates on October 24, allowing domestic financial institutions to offer market-based interest rates.
The AFP said in a report on October 24 that the reform would "introduce true competition for capital" in China.
"The reforms on interest rates started from 1996, and it was not until this year that those reforms came to a conclusion," said Zhao.
Zhao noted that the pace for reform sped up after the Third Plenary Session of the 18th CPC Central Committee held in November 2013, during which a document was released on deepening the domestic reforms in an all-round way.
Zhao said the government used to set a relatively fixed interest rate for domestic financial institutions, but after the reform, banks can set their own interest rates as needed.
"If the banks are capable, and people are willing to deposit money with them, they can set an interest rate which can give savers better yields," Zhao said.
"It's hard to explain the tangible impact of this kind of policy on the domestic banking sector, because it has just been launched," Zhao noted. "However, we can learn from past experience that the government's domination of any competitive sector usually leads to inefficiency."
"Besides, the interest rate reform could largely enhance banking services, and this will benefit the banks' customers," Zhao said.
Because the reform will intensify competition in the banking sector, he said small banks should enhance their competitiveness with many measures, such as forming a union of small financial institutions, or seeking mergers with larger banks.
