News China fintech companies find new opportunities in small business...

China fintech companies find new opportunities in small business loans

-

- Advertisment -

An Alipay digital payment app logo and smartphone sit on a desktop at the Wirecard AG headquarters in Munich, Germany, on Wednesday, Sept. 5, 2018.

Matthias Doering | Bloomberg | Getty Images

An Alipay digital payment app logo and smartphone sit on a desktop at the Wirecard AG headquarters in Munich, Germany, on Wednesday, Sept. 5, 2018.

China’s push to encourage lending to smaller companies has created a business opportunity for large financial technology companies.

As Beijing struggles to balance a crackdown on high debt levels with maintaining growth, President Xi Jinping and Premier Li Keqiang have both publicly announced support for privately-run companies. The central bank has also freed up cash for lending in recent months, and eased rules to help small businesses obtain funds more easily.

Still, the business environment — particularly in financing — still favors state-owned companies, despite the fact that the private sector contributes to the majority of job creation and economic growth in the country.

But there’s money to be made for those willing to lend to smaller businesses, particularly if some of the risks can be mitigated. According to Tencent-backed online lender WeBank, roughly 80 percent of the nearly 90 million small and micro-sized enterprises in China don’t have a credit with a bank.

That’s where fintech can play a greater role.

Thanks to their close ties to Chinese technology giants, -backed online lender MYbank and -backed WeBank can use hordes of payment information or social network data to ascertain the ability of a business to pay back its loans. That’s the kind of basic credit information many companies in the private sector have been unable to provide, and partly why traditional banks prefer to lend to large, state-owned enterprises instead.

Micro and small-sized enterprises do not get equal financial support relative to their contribution to China’s economic growth

Source

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Latest news

Make Fast and Secure Trades Using Bitengo.io

Bitengo.io is a Cryptocurrency trading platform that allows users to buy and sell their Cryptocurrency in a...

Network Security Using Cryptography: Everything you need to know

This article will describe what is Network Security Using Cryptography and everything you need to know before...

Mercuriex Cryptocurrency Exchange Launches New Utility Token, SURF

MercuriEx Cryptocurrency Exchange, originally developed in 2017, came under new ownership in December 2019. Since taking over the exchange,...

Fungibility: Bitcoin Mixers Favorite Term That No One Understands

Fungibility, perhaps the most important concept when dealing with a decentralized and anonymous currency, but does bitcoin...
- Advertisement -China fintech companies find new opportunities in small business loans

Crypto can’t thrive in the real world – but stablecoins can

We can safely say that the hype about cryptocurrencies is pretty much over. The claims of Bitcoin...

How to double your crypto

Most of us have a small gambler deep inside our souls. We love to feel the thrill...

Must read

Make Fast and Secure Trades Using Bitengo.io

Bitengo.io is a Cryptocurrency trading platform that...
- Advertisement -China fintech companies find new opportunities in small business loansChina fintech companies find new opportunities in small business loans

You might also likeRELATED
Recommended to you