Beijing assists small and micro enterprises through financial innovation

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The Beijing Banking and Insurance Supervision Bureau recently announced that in 2020, initial loans from the city’s banks to small and micro enterprises reached 80 billion yuan, adding a total of 34,000 first-time borrowers. After three months of operation, banks in Beijing’s initial loan center have approved 429 loans worth a total of 1.7 billion yuan.

Planning for China’s first initial loan center began last year, and the center was put into use on April 1, 2020. The loan center serves “zero credit” lenders as well as other urgent loan seekers. It is home to representatives from 22 banks, three financing guarantee institutions and three micro-finance institutions, making it easy for borrowers to consult and gather information.

“Many companies are unclear about banking products when they’re looking to get a bank loan for the first time, which makes it difficult for them to choose,” explained Zhang Xiaowei, assistant to the CEO of Beijing Green Valley Technology. Co, Ltd. She added that compared with bank outlets, enterprises can compare all the loan products from every bank at the same time in the loan center, and can also make use of various preferential loan policies.

The company received a 10-million-yuan credit loan from the Zhongguancun sub-branch of Huaxia Bank, which helped the company solve the problem of a lack of pledges. Zhang said that thanks to the preferential interest rate policies targeting high-tech enterprises during the epidemic, the final discounted interest rate of this loan was less than 3% in total, which helped ensure the company’s capital flow.

According to an official from the initial loan center, the center adopts a service-window model, allowing enterprises to interact with banks face-to-face. This model improves transaction transparency, spurs on the banks to offer better services, and reduces corporate financing costs.

An official from Beijing Financial Holdings Group revealed that government data in the loan center is powered by the city’s public financial data, which enables the banks in the center to check information on enterprises more accurately and efficiently.

The Beijing Banking and Insurance Supervision Bureau will work together with the Beijing Local Financial Supervision and Administration to strengthen follow-up evaluations on the service quality of the banks and service support institutions in the loan center, so as to further ease the financing difficulties facing small and micro enterprises.

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