Jul 09, 2018 (China Knowledge) - China Banking and Insurance Regulatory Commission (CBIRC) have issued a notice last month requesting regular monitoring and guidance on the loan interest rate of small and micro enterprises in the banking industry, striving to achieve the goal of lowering the newly issued interest rate for inclusive small and micro enterprises in the third quarter of this year.
According to the notice, in order to enhance the regular monitoring and guidance of the loan interest rate of small and micro enterprises in large and medium-sized commercial banks, the differentiated interest rate pricing capability should be further improved, and the real-time monitoring of the loan interest rate of inclusive small and micro enterprises should be strengthened.
In order to urge banks to establish effective mechanisms for the management of loan costs for small and micro enterprises, large and medium-sized commercial banks that have established inclusive finance divisions should further improve the cost sharing and revenue sharing mechanisms, dynamically adjust internal capital transfer prices, and effectively reduce the internal financing costs for small and micro enterprise loans.
CBIRC also said that it is necessary to spur relevant departments to further regulate private lending activities, crack down on financial fraud, malicious evasion of debts, illegal fund-raising and other illegal financial activities, and direct social funds to the financing needs of small and micro enterprises.
On April 25, the State Council executive meeting clearly stated that it strives to reduce the financing costs of small and micro enterprises by the end of the third quarter and ensure that the financing costs of the real economy will fall this year.
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