Banks in China are starting to look at internet companies to see how they can collect more data on their customers, CG Lai, the chief executive of BNP Paribas China, told CNBC.
Over the years, Chinese banks have failed to extract as much data from their customers as the internet firms have, Lai explained.
"For many years, they have all the customers and these Chinese banks are mostly doing the inter-bank or the wholesale business," Lai said at CNBC's East Tech West conference in the Nansha district of Guangzhou, China.
"They really didn't study and know very well about their individual clients. That is why the approach now is to create a much more horizontal approach setting up the apps that cover every aspect of their clients, so they can get better data, the same as the internet company getting the data in order to determine how they are going to serve their clients."
Lai told Nancy Hungerford during a panel discussion on Monday: "The banks are trying to learn from the internet companies, despite all the clients they have."
"It would be a challenge to really get to know them. And this is what they are trying to do, before they can take off to another stage."
Facebook has been criticized for collecting too much data on its users and for failing to use that data correctly. Most notably perhaps, the social media giant shared data on 87 million people with Cambridge Analytica, which used that data for political advertising purposes. Facebook CEO Mark Zuckerberg says he is taking steps to ensure Facebook users understand how the company uses their data.
Chinese tech giants like Alibaba and Tencent also know a great deal about their customers. But attitudes toward privacy and data collection in China are more subdued than they are in the West. Citizens, for example, are often more than happy to share their personal data with large corporations if it means they get a more customized experience, and many simply accept the data collection and surveillance practices of the Chinese government.
Asked about data protection concerns, Lai said: "That might be an issue in the Western world but I think in China, very few people worry about those things. It's a reality."