Private lending center set up in Wenzhou
April 30, 2012 Category Finance, Weekly
A center that will monitor and act as a clearinghouse for private lending opened in Wenzhou, Zhejiang province, under a 12-point pilot plan to reform the city’s financial industry. The center is intended to bring Wenzhou’s huge, unquantified “shadow banking” system under control. It has CNY6 million in registered capital and 22 investors. The center will disseminate private lending related information, register private loans, provide credit ratings, and rent office space to private lenders. The center aims to make private lending traceable and prevent a build-up of risks, said Zhou Dewen, Chairman of the Wenzhou Small and Medium-sized Enterprises Development Association. There is no authoritative figure for the scale of private lending in Wenzhou because everything’s done underground, Zhou said. Last year some entrepreneurs fled after being unable or unwilling to repay debt bearing usurious rates of up to 90%. Many entrepreneurs in Wenzhou turned to private lending last year when state-owned banks cut loans to small and medium-sized enterprises amid credit-tightening measures by the central bank. The founding of the center was one of the 12 measures promised in a central government decision earlier this year to make Wenzhou a “pilot zone” for a series of financial reforms. The reforms also include allowing residents of the coastal city to invest privately overseas and set up loan companies. Wenzhou will also set up a finance supervision bureau and crack down on irregularities in the financial industry. The plan calls for Wenzhou to have at least 30 rural financial institutions and 100 microcredit companies with CNY40 billion in net assets by the end of 2013, the China Daily reports.
- KURT VANDEPUTTE (UMICORE) APPOINTED CHAIRMAN OF THE BOARD OF THE FLANDERS-CHINA CHAMBER OF COMMERCE (FCCC)
- Webinar: “Knowing Your Chinese Partner” – May 26, 2021, 10 am – 12 am
- EMA starts rolling review of CoronaVac, WHO approves Sinopharm vaccine for emergency use
- The Global Times warns not to politicize the Comprehensive Agreement on Investment (CAI)
- Hainan to become biggest duty-free market in the world