China.org.cn | December 9, 2024
Phoenix TV:
Micro- and small-sized enterprises are crucial for stabilizing the economy, expanding employment and improving people's livelihoods. Could you please elaborate on the measures taken by the NFRA to assist enterprises in difficulty and alleviate financing challenges for micro- and small-sized business entities? Thank you.
Cong Lin:
Thank you for your question. Micro- and small-sized enterprises are closely connected to countless households. I appreciate your attention to the financial work concerning these enterprises. In accordance with the decisions and deployments of the CPC Central Committee and the State Council, especially following the guiding principles of the meeting of the Political Bureau of the CPC Central Committee on Sept. 26, we have been guiding financial institutions to increase financial support to the real economy and optimize financial services for various types of business entities. Recently, we have introduced a series of measures focused on supporting enterprises. The key aim of these measures is to address the financing bottlenecks and obstacles for micro- and small-sized enterprises, optimize the business environment, facilitate financing channels, and strive to maintain quality services while offering more competitive pricing.
Let me start by presenting a set of financial data. Overall, the supply of credit has been steadily increasing. By the end of August, the balance of RMB loans had reached 252.02 trillion yuan, an increase of 8.5% year on year. Insurance companies provided various financing support totaling 28.8 trillion yuan through bonds, stocks and other means. In terms of structure, support for key areas continues to increase. Loans to inclusive micro- and small-sized enterprises grew by 16.1% year on year, while loans to private enterprises increased by 9%. Regarding the price, interest rates have remained stable with a slight decline. From January to August this year, the interest rate on newly issued loans to inclusive micro- and small-sized enterprises decreased by 0.4% compared to the same period last year.
Here are some specific measures:
First, optimizing the policy of loan renewals without principal repayment to ease cash flow pressures for businesses. This policy not only applies to micro- and small-sized enterprises but has also temporarily been expanded to medium-sized enterprises. It should be emphasized that eligible renewal loans should not have their risk classification downgraded solely due to the renewal process. Banks need to enhance risk management, taking into account factors such as the borrower's repayment capacity and collateral, to appropriately classify the risk associated with each renewal loan.
Second, collaborating with the National Development and Reform Commission (NDRC) to establish a financing coordination mechanism to support micro- and small-sized enterprises. The core of this mechanism involves setting up specialized teams at the district and county levels to facilitate precise communication between banks and enterprises. On the enterprise side, a comprehensive understanding of the actual business operations within the jurisdiction will be obtained to achieve targeted assistance and effectively address the financing challenges faced by enterprises. On the bank side, obstacles and bottlenecks in information and fund transmission will be cleared. The goal is to ensure that legally compliant enterprises with genuine financing needs and good credit standing can access the financing they need through this mechanism. Moreover, the funds are direct without intermediaries, and the financing costs are reasonable.
Third, further leveraging the protective role of insurance. In areas such as construction projects and foreign trade exports, the substitution of deposits with performance guarantee insurance and tariff guarantee insurance is encouraged. In the first half of the year, this measure has freed up capital for 520,000 companies, reducing their financial pressure on cash flow. Additionally, export credit insurance companies are encouraged in providing comprehensive financial services such as "credit guarantee + policy financing" to address the concerns of exporters.
Fourth, improving the liability exemption system. We all know that the key to enhancing financial services for micro and small enterprises is to relieve the burden on primary-level lending personnel and foster a positive atmosphere that encourages responsibility among them while ensuring that they will be exempt from liability under the purview of due diligence. Recently, we further revised the original notice about the liability exemption mechanism for inclusive lending, clarifying various exemption situations. For personnel who basically fulfill their job responsibilities and only make minor mistakes, their liability will be reduced or exempted. We learned that many banks have already refined and improved their internal regulations according to regulatory requirements, and the number and proportion of exemptions have increased.
In addition, our regulatory work will be more targeted. Under the premise of law-based and comprehensive regulation, we will adopt more flexible and inclusive regulatory measures, such as policy guidance, risk alerts and prompts for corrective action, to address general and operational risks in inclusive finance, particularly in services for micro and small enterprises. This approach integrates regulation with service. With this more humane approach, we aim to enhance the enthusiasm and proactivity of financial institutions to implement support policies, thereby creating a favorable environment for business development.
That's all from me. Thank you.