Beijing is pushing for strong growth in lending to small and medium-sized enterprises (SME’s) in 2021 as part of broader efforts to drive financial inclusion and support the real economy.
China’s 2021 Government Work Report sets a growth target for SME lending by large-scale commercial banks of at least 30% this year, in order to “further resolve the financing difficulties of micro and small enterprises (MSE’s).”
Wang Yifeng (王一峰), chief analyst with Everbright Securities, says that large-scale banks will continue to play a leading role in the extension of loans to SME’s, and forecasts that new SME lending will reach 1.45 trillion yuan (approx. USD$223.08 billion) in 2021.
The Government Work Report also proposes the extension of policies to reduce financial guarantee fees for MSE’s, while calling for “innovation in supply chain finance service models.”
“Overall, these measures embody a greater emphasis placed on the financial system servicing the real economy, and in particular SME’s,” said Wen Bin (温彬), chief analyst with China Minsheng Bank, to state-owned media.