The last of five private banks that are expected to usher in a new era in China's banking industry has received official approval to commence operations.

Xinhua news agency has reported that the business model of MYbank, an Internet bank much like the famous PayPal, was approved by the Zhejiang Banking Regulatory Commission.

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The approval means that MYBank, also known as Zhejiang Wangshang Bank, can start setting up its business operations in China. MyBank has a registered capital of ¥4 billion ($645 million) and will focus on acquiring financial products that have a ¥ 200,000 minimum deposit and offer loans of up to ¥5 million.

A company co-owned by Alibaba Chairman Jack Ma - Zhejiang Ant Small and Micro Financial Services Company - is MYbank's biggest shareholder with a 30 percent stake. The new bank also received funding from Fosun Group, Wanxiang Group, and Ningbo Jinrun Asset Management Company.

The bank will not have a physical branch and will cater to small and micro businesses only, aside from online shoppers.

MYBank and four other private banks were given the China Banking Regulatory Commission's approval in 2014, according to Want ChinaTimes.

The other freshmen to China's predominantly state-owned banking industry include Qianhai Micro Bank, Wenzhou Minshang Bank, Tianjin Jincheng Bank and Shanghai Huarui Bank.

Meanwhile, International Business Times has reported that some industry experts believe the approval of these banks is the beginning of change in the country's banking industry. Before the approval of the five mentioned banks, China only had one private bank.

Peterson Institute for International Economics' Nicholas Lardy told the news outlet that the approval will also put pressure on traditional banks because of the ease of access that online banks could offer.

China Minsheng Banking Corporation Limited was the first bank not controlled by the state that was opened in the country. The bank was founded in 1996 and caters to small and medium-sized companies.

TagsQianhai Micro Bank, Wenzhou Minshang Bank, Tianjin Jincheng Bank, Shanghai Huarui Bank, Zhejiang Wangshang Bank, MyBank, China Banks, Jack Ma