By Xia Bin　

Date: 2003/08/27

Abstract：

The article holds that most of financial innovations are for breaching the control on interest rate and different sectors. The factors impeding further financial innovations are that imbalanced supervision policies lag behind innovations, the market is immature and the fundamental conditions for financial institutions are weak. Therefore, it is necessary to correctly handle the relations between warding off financial risks and encouraging innovations. The supervision departments should raise their ability to differentiate innovations from the acts of breaching regulations. The dialogue mechanism should be established as soon as possible, the examination system for financial innovations should be consummated and the market economic system perfection should be pushed forward in a progressive and innovative way. The market micro subject should pay due attention to the analysis of benefits and risks in making innovations.