Shanghai Think Tank Calls for Smaller Banks to Use Fintech to Improve Inclusive Services

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A leading Shanghai-based think tank has called for smaller-sized lenders to make greater use of fintech to help drive financial inclusion in China.

On 17 March the Shanghai Institution for Finance & Development (SIFD) released a report on smaller banks in China entitled “Challenges for Small and Medium-sized Banks Servicing Micro and Small Enterprises and the Path for Breakthrough” (中小银行服务小微的挑战与破局之道).

The Report highlights a range of challenges for smaller banks in China to improve their provision of loans to micro-and-small enterprises, including risk control, ability to secure clients, technology levels, and competition against the established big banks.

The Report recommends that small and medium-sized banks in China make greater use of technology, as well as targeted risk control and more nimble organisation, in order to raise the quality and efficiency of their services to micro-and-small enterprises.

A meeting of the National Institute for Finance & Development (NIFD) also held on 17 March called for small and medium-sized banks to “make full use of advantages including local resources, proximity to the market and customers and organisational flexibility, to strengthen their position as the main force for micro-and-small loans.”