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China's banking and insurance regulator issued a circular Sunday on
further promoting high-quality development of financial services to
small and medium-sized enterprises (SMEs) in 2021. Efforts will be made to enhance the effective growth of financial
support to SMEs and significantly improve its quality, efficiency and
effectiveness, according to the circular issued by the China Banking and
Insurance Regulatory Commission. Vowing to speed up the expansion of inclusive loans to SMEs and
increase the number of borrowers this year, the circular urges the five
major banks to increase their inclusive loans to the firms by over 30
percent. It requires large and joint-stock banks to play a leading role in
optimizing services to SMEs borrowing for the first time and make the
number of new first-time borrowers exceed that of last year. Measures will be taken to continue the growth of initial, renewed and
credit loans to SMEs. The focus will be on increasing medium- and
long-term credit support for advanced manufacturing, strategic emerging
industries, and the industrial and supply chains, says the circular. Financial services to technology-based SMEs will be improved to
promote industrialization and large-scale application of new
technologies. Comprehensive financial service plans will cover upstream
and downstream SMEs of core enterprises in the industrial and supply
chains. The circular also encourages enhanced cooperation between banking and
insurance institutions to offer innovative products to SMEs under the
premise of controllable risks. China's inclusive loans to SMEs have registered rapid growth for
three consecutive years. The balance of outstanding loans reached 16.81
trillion yuan (about 2.59 trillion U.S. dollars) by the end of March
2021, surging by 33.87 percent year on year, which covered more than
27.4 million borrowers.
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