Although China's nascent online finance industry has some very vocal critics, others see the sector as an agent of change that will bring higher interest rates for depositors and additional financing for struggling small and medium-sized enterprises.

"China's SMEs face multiple challenges. They must pay high borrowing costs and rising material costs, and some manufacturing is flowing back to the United States," said Guo Guangchang, founder and chairman of Fosun International Ltd.

The SME sector generates more than 60 percent of China's gross domestic product and about 80 percent of urban employment.

But most SMEs in China use obsolete technology and equipment. These companies are hindered by poor performance, low efficiency, and high energy and water consumption, relative to large, often State-owned enterprises, according to a report by the World Bank Group.

"Once the deposit interest rate is market-oriented, competitive SMEs will benefit from lower interest rates" as more money flows into the financial system instead of being parked in property, for example, Guo said.

"As those companies prosper, underperformers will be driven out of their respective markets and industries, which is in line with the country's economic restructuring," said Guo, during a group discussion of the second session of the 12th National Committee of the Chinese People's Political Consultative Conference.

Commentators have claimed that online financing products such as Yu'ebao are altering the nation's financial terrain and even hurting the real economy, because online funds put customers' money into time deposits with banks, rather than directly into industry.

"I am wondering whether these online financing products will raise the costs for social financing, and then add to the burden on enterprises," said Liu Liehong, president of China Electronics Corp.

Pan Gongshen, vice-governor of China's central bank, said there's no conflict between Internet finance and the real economy.

"Internet finance will provide more support for SMEs because it is broadening investment channels among common people, improving the efficiency of transactions as well as lowering transaction costs," said Pan.

Pan called for further innovation in the financial sector and deeper financial reform. He said these trends would "ease access to the market and channel private capital into the financial sector."

Given the near-absence of a regulatory framework at present, Pan suggested that it is important to map out a supervisory system.

Ma Weihua, the former governor of China Merchants Bank Co Ltd, said it is necessary to affirm the innovation of online finance, especially before full deregulation of interest rates.

"Traditional banks are confronted with fiercer competition in areas such as payments, credit and wealth management.

"But the appearance of Yu'ebao and other similar products prompt us to realize the power of scattered capital from the grassroots level," said Ma.

In Ma's opinion, Internet finance and traditional banks are highly complementary, as they are both expanding the coverage of finance across China.