The China Banking and Insurance Regulatory Commission (CBIRC) has issued a new directive mandating that Chinese lenders provide micro-and-small enterprises (MSE’s) with greater financial support.
CBIRC recently issued the “Notice on Work to Further Strengthen Financial Support for the Development of Micro-and-Small Enterprises in 2022” (关于2022年进一步强化金融支持小微企业发展工作的通知).
The Notice calls for Chinese banking sector financial institutions to continue to achieve the goal of the “two increases” when it comes to financial inclusion loans for MSE’s.
The “two increases” refers specifically to the increase in financial inclusion MSE lending outpacing growth in total lending, as well as an increase the number of borrowers compared to levels at the start of the year.
CBIRC called for Chinese banks to “expand the intensity of credit extension, strive to continue to raise the financial inclusion MSE loan balance as a share of total credit, and strive to increase the share of first-time borrowers amongst MSE borrowers.”
The banking regulator also called for Chinese banks to strive to ensure that interest rates for new financial inclusion loans to MSE’s in 2022 are lower than rates in 2021.
