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Financial Supervisory Board: urging banks to implement policies to ensure smooth refinancing for small and micro-enterprises
AInvestWednesday, Aug 21, 2024 3:50 am ET
1min read
EFSC --

On August 21, the China Banking and Insurance Regulatory Commission (CBRC) publicly responded to the 1352nd proposal of the 14th National People's Congress' second meeting.In response to the proposal by Yang Ruishu to increase financial support for small and medium-sized enterprises, the CBRC stated that it attached great importance to the problem of financing for small and micro-enterprises, and in order to shorten the loan turnover time and reduce the cost of "bridging" funds, it introduced a preferential policy for the renewal of small and micro-enterprises' loans.For small and micro-enterprises with financing needs after the maturity of their working capital loans, banks can start the loan investigation and evaluation according to the requirements for the new issuance of loans in advance, and for small and micro-enterprises with normal operations, good credit and meeting the conditions for renewal, banks can sign a new loan contract with the enterprise before the maturity of the loan and issue a new loan to settle the existing loan, providing support for the renewal of small and micro-enterprises' loans.Banks and insurance institutions should develop specialized products for the renewal of small and micro-enterprises' loans or improve the renewal function of existing products. In principle, small and micro-enterprise working capital loan products and small and micro-enterprise owner and individual business loans should all have the function of renewal.As of May 2024, the outstanding balance of small and micro-enterprise renewal loans without principal repayment was RMB576 billion, up 25.6% year-on-year. In the next step, the CBRC will continue to urge banks and insurance institutions to implement the regulatory policy for the renewal of small and micro-enterprise loans and strengthen the development of renewal products, and increase the renewal loan support for small and micro-enterprises that meet the conditions.

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