Guangdong Issues Directive Calling for Use of Fintech and Data Sharing to Drive Financial Inclusion, ESG Investment and Tech Lending

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The provincial government of Guangdong has released a new directive calling for the use of fintech and data technologies to enhance lending initiatives across a range of areas.

The Guangdong province government issued the “Notice Concerning the Guangdong Province Action Plan for Deeply Advancing Reform for the Marketised Allocation of Capital Factors of Production” (广东省人民政府关于印发广东省深入推进资本要素市场化配置改革行动方案的通知) on 14 September.

The Notice addresses a range of areas including cross-border payments, the digital renminbi, fintech and financial data sharing.

With regard to fintech, the Notice calls for “the establishment of connection mechanisms for sharing government data with financial institutions, supporting Shenzhen in deepening innovation trials for digital renminbi applications, applying for expansions in the scope of trial cities when appropriate, and driving Guangzhou in work to apply for digital renminbi trials.”

On the matter of regional integration, the Notice calls for “accelerating the integration and connection of the financial markets of the Greater Bay Area, and driving the implementation as soon as possible of ‘Cross-border Wealth Management Connect’ trials.”

It also calls for “using blockchain technology as the foundations for the joint establishment of a ‘Credit Chain’ in Guangdong, Hong Kong and Macau, and expediting credit cooperation in the Greater Bay Area.”

With regard to the island of Hengqin, which has been designated as a zone for advancing economic integration with Macau, the Notice calls for “driving cross-border linkages for mobile payments service; exploring more unique online cross-border operations, and raising the level of convenience for payments by Macau residents.”

The Notice outlines greater support for tech companies, including the “application of fintech methods to provide services such as credit imaging to tech companies, and increasing the use of quantitative data on utilities payments, tax payments and social welfare to support tech enterprise financing.”

On the financial inclusion front, Guangdong province will “vigorously support the establishment of small and medium-sized enterprise financing platforms and credit information platforms; the establishment of healthy and open sharing mechanisms for the gathering and integration of credit information at all levels, and the provision of data support to financial institutions for servicing micro, small and medium-sized enterprises.”

“Commercial banks are encouraged to use fintech, innovative digital financial inclusion products and services to expand the vigour of first loans and subsequent loans to micro and small enterprises.”

Guangdong province also hopes to “create innovative supply chain financing models to provide financial support for the financing of micro, small and medium-sized enterprises on industry and supply chains.”

With regard to ESG financing, Guangdong province will “actively explore green financial services and products…develop digital green finance, and use fintech to drive the disclosure and sharing of environmental information, and explore green asset transactions based on the blockchain.”

The Notice also stresses the need to “raise the digitisation and smart capabilities of financial regulation, strengthen the monitoring of capital flows, and appropriately perform risk prevention, early warning and disposal work.”

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