CRI听力:How Crowdfunding Becomes Emerging Trend in China?

While heated debate and sharp disagreements still exist around the new trend, crowd-funding generally refers to an internet-based financing channel that allows a group of ordinary people to jointly invest in one project.

The projects can range from equities of a startup company, virtually any kind of product or goods, to charitable donations and even apartments.

Panelist Jin Lin, vice president of JD.com's financial arm, attributes its popularity more to the growth of China's young population.

"Firstly, crowd-funding is a firm belief held by many investors. At the same time, many crowd-funded products are equipped with an intelligent hardware system, thus creating a unique user experience. As such, with the rise of young people born after the 1990s, the growth of market demand in crowdfunding is higher than the average level."

Luo Mingxiong, CEO of Beijing North Financial, says it is mainly due to the government's innovation-driven incentives.

"Crowd-funding has a lot to do with China's efforts to boost mass entrepreneurship and innovation. On one hand, more and more people choose to start up their own companies inspired by the huge success of Alibaba and JD.com; on the other hand, the public intends to join the investment of these startups. "

Last summer, crowd-funding was put on the spotlight as self-made animation "Monkey King: Hero is Back" snatched the crown for best-selling animation in Chinese history.

109 children, with an average age of under four-years-old, are included on the long list of producers for the movie, as their parents together raised 78-million yuan to fund the film.

They gained an unexpected sum of 300 million yuan in return.

Beyond China, other Asian nations are also embracing a boom in crowdfunding, though many are still at the beginning stage.

Panelist Ahsan IQBAL is the Minister of Planning, Reform and Development in Pakistan. He elaborates on how the young generation in his country is contributing to the rising trend, particularly in community development and philanthropy.

"There is a woman activist who is working for the neighbors in brick-making industry. So, she was working to free these labors from the control of brick makers. There was one blogger from New York. He came and broadcast in his blog about her story. Within two weeks, she was able to get 2.3 billion dollars from 75 thousand people all over the world."

Despite its great appeal, most companies in China do admit that their crowd-funding platforms are still not profitable, as most of their revenue comes from short-term service charges from start-ups and product suppliers.

Crowd-funding also faces challenges such as the lack of governmental regulations and education of both investors and practitioners.

Economist Wu Xiaoqiu from Renmin University suggests that the key lies in how to reduce information asymmetry between investors and crowd-funded projects.

"The first thing is to improve the crowd-funding platforms so as to provide investors with more real information on the Internet. Also, financiers taking charge of the crowd-funded projects should also be proactive to disclose more information. Once information transparency is guaranteed, investors will be able to make rational choices."

However, as for how to regulate the sunrise industry, panelists have yet to reach a consensus on whether a license is needed in future for the over 280 crowd-funding platforms in China.

2015 was widely seen as a starting point for crowd-funding here in China, and it is expected to raise 30 billion yuan by the end of this year.

For CRI, I am Wang Mengzhen reporting from Bo'ao.