The Internet finance we now define is the definition of financial business under the unified environment of the Internet and mobile Internet. Overview Internet finance is the new ecology of finance in the Internet era. Today, Alibaba, Tencent and Ping An of China took the lead in setting up an Internet finance company, creating a good opportunity for the public to understand Internet finance. Model Analysis Modern information technology represented by the Internet, especially mobile payments, cloud computing, social networks and search engines, will have a fundamental impact on human financial models. In 20 years, a third financial operating mechanism that is different from indirect financing by commercial banks and direct financing in the capital market may be formed, which can be called the "Internet direct financing market" or "Internet finance model." Under the Internet financial model, due to the presence of search engines, big data, social networks and cloud computing, the degree of market information asymmetry is very low. The costs for both parties to match the funding period and risk sharing are very low. Intermediaries such as banks, securities firms and exchanges None of them work; the issuance and trading of loans, stocks, bonds, etc., as well as coupon payments are directly conducted online. This market is fully efficient and close to the state without financial intermediaries described by the general equilibrium theorem. Under this financial model, payment is convenient, search engines and social networks reduce information processing costs, and direct transactions between supply and demand of funds can achieve the same resource allocation efficiency as the current direct financing in the capital market and indirect financing by banks, while promoting economic growth. , significantly reducing transaction costs. The key points of the model are: first, information processing; second, risk assessment; third, matching the period and quantity of fund supply and demand, which can be solved by oneself without going through intermediaries such as banks or securities firms; fourth, super centralized payment system and individual Unification of mobile payments; fifth, direct transactions between supply and demand sides; sixth, product simplification (reduced need for risk hedging); seventh, financial market operation is completely Internet-based, with minimal transaction costs. The payment method under the Internet financial model in the mobile payment era is based on mobile payment. Mobile payment relies on the development of mobile communication technology and equipment, especially the popularity of smartphones and iPads. Juniper Research estimates that the total global mobile payment volume in 2011 was US$240 billion and is expected to grow by 200% in the next five years. With the development of technologies such as Wi-Fi and 3G, the integration trend of the Internet and mobile communication networks is very obvious, and wired telephone networks and radio and television networks are also integrated. Mobile payment will be further integrated with electronic payment methods such as bank cards and online banking to truly enable payment anytime, anywhere and in any way. With the development of security software such as identity authentication technology and digital signature technology, mobile payment can not only solve small-amount payments in daily life, but also solve large-amount payments between enterprises, replacing current bank settlement payment methods such as cash and checks. . Although mobile communication devices have become more intelligent, due to portability and volume requirements, storage capacity and computing speed cannot be compared with personal computers (PCs) in the short term. Cloud computing can just make up for the shortcomings of mobile communication equipment. Cloud computing can transfer storage and computing from mobile communication terminals to cloud computing servers, reducing the information processing burden on mobile communication devices. In this way, mobile communication terminals will integrate the functions of mobile phones and traditional PCs to ensure the efficiency of mobile payments. Under the Internet financial model, the payment system has the following fundamental characteristics: all individuals and institutions open accounts (deposits and securities registration) at the central bank’s payment center (super online banking); payments and transfers of financial assets such as securities and cash are made through the mobile Internet Conducted online (specific tools are mobile phones and iPads); payment and settlement are completely electronic, and there is no cash circulation in society; the secondary commercial bank account system may no longer exist. The deposit accounts of individuals and businesses are all in the central bank, which will have a significant impact on money supply and monetary policy, and will also promote major changes in monetary policy theory and operations. Of course, this payment system will not subvert the current human system of unified issuance of credit currency by the central bank.