Chinese policymakers should keep a close eye on digital finance risks by developing regulatory frameworks and supervisory approaches, according to a report jointly issued by the country's central bank and the World Bank Group on Sunday.

The report acknowledged that China has been a leader in the global fintech revolution, "with new technology-driven providers transforming how Chinese consumers make payments, borrow, save, insure themselves against risk, and invest".

The report, titled "Toward Universal Financial Inclusion in China: Models, Challenges, and Global Lessons", applauded the fact that "China has achieved remarkable success in financial inclusion over the last 15 years" after examining the country's approach and comparing the financial inclusion progress made by the country against peer economies.

Financial inclusion means that individuals and businesses have access to useful and affordable financial products and services that meet their needs, including transactions, payments, savings, credit and insurance.

"China's rate of account ownership - a basic metric of financial inclusion - has increased significantly and is now on par with that of other G20 countries," while having the world's largest agent banking network, said a news release on the website of the World Bank.

The People's Bank of China, the central bank, said China has pushed forward financial inclusion development since the early 2000s by broadening the availability of basic financial products through improvements in credit and payments infrastructure, expanding physical access points for rural consumers and establishing new types of financial service providers.

The ongoing fintech revolution in the world's second-largest economy is motivating traditional financial service providers to actively pursue digitally enabled business models, integrating financial services into existing e-commerce or social media platforms, which has actively broadened finance inclusion achievement, the report noted.

"China's experience provides valuable lessons to authorities in other countries which are fashioning their own pathways toward sustainable and long-term financial inclusion," it said.

But the report also warned the country's financial authority to address financial consumer protection risks, given the limited digital and financial literacy of many consumers.

Fintech also elevates the risk of digital finance, especially in regards to data privacy and fraud, forming new challenges to achieving sustainable and long-term financial inclusion.

"The country will need to shift toward more market-based, commercially sustainable approaches to financial inclusion," the report suggested.

In 2015, China launched a five-year plan to improve financial inclusion development by 2020, leading with the PBOC, which is in line with the World Bank's commitment to achieve "Universal Financial Access", ensuring that adults globally have access to transaction accounts to store money and send and receive payments.

In order to achieve the goal, more market-based and commercially sustainable approaches are preferred, while more effective regulatory frameworks also need to be further developed, according to experts.

Jack Chan, financial services managing partner with the global financial services firm Ernst and Young Greater China said that "increased provision of financial services by non-governmental organizations, e-commerce firms, fintechs, retailers and telecommunication companies has a direct impact on expanding financial inclusion."