China releases white paper on financial services for small businesses

Source: Xinhua| 2019-06-24 23:57:30|Editor: Yang Yi
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BEIJING, June 24 (Xinhua) -- China on Monday issued a white paper on financial services provided for small and medium-sized enterprises (SMEs).

As a major source of new growth drivers, SMEs have played an important role in promoting economic growth, increasing jobs and stimulating innovation, says the white paper released by authorities including the People's Bank of China and the China Banking and Insurance Regulatory Commission.

By strengthening counter-cyclical adjustments, keeping the liquidity at a reasonable and ample level, and comprehensively utilizing credit, bonds and equity, China has effectively alleviated the financing difficulty facing SMEs.

China's capacity of providing financial services for the SMEs has seen remarkable improvement, with the credit supply constantly increased, financing cost steadily lowered and financial coverage widened.

By the end of 2018, nationwide outstanding inclusive loans to SMEs reached 8 trillion yuan (about 1.12 trillion U.S. dollars), up 18 percent year-on-year and 8.2 percentage points faster than the growth at the end of the year before, according to the paper.

At the same time, the organization and product system of financial institutions in the banking sector has been constantly optimized, with large banks taking the lead in increasing input and lowering cost.

The combined outstanding inclusive loans offered by the country's five large state-owned commercial banks to SMEs has increased 23.7 percent by the end of May from the end of last year, while the average interest rate stood at 4.79 percent, 0.65 percentage points lower than the whole year of 2018.

The efficiency of financial institutions serving small companies has also been increasingly enhanced thanks partly to the optimized credit management pattern and the use of fin-tech means.

China's policy framework for beefing up financial support for the SMEs has been improved via implementing targeted cut in reserve requirement ratio and medium-term lending facility, as well as increasing support for re-lending and rediscount.

However, the white paper has also pointed out that solving financing difficulty facing small firms would be a long, complicated and arduous process.

China will continue to deepen financial supply-side structural reform and improve the policy environment to provide higher-quality and more effective financial services to SMEs, according to the white paper.