(Source: Xinhua Finance 2025-07-02)
On July 2, Bian Yang, a researcher at the Beijing Institute for Opening-up at the w88 casino, and others published an article in Xinhua Finance titled "Maintaining Credit Supply to Small and Micro Enterprises by Lowering Comprehensive Financing Costs." The following is the content of the article.
Small and micro enterprises are an important force in absorbing employment and promoting economic growth. As of the third quarter of 2024, the number of registered individual industrial and commercial households nationwide has reached 125 million, accounting for two-thirds of the total number of business entities. Entering 2025, my country's economy has continued to stabilize and improve, with GDP growing by 5.4% year-on-year in the first quarter. At the same time, the increasing uncertainty in the global economy has also brought certain challenges to the development of small and micro enterprises.
In recent years, my country has implemented a moderately loose monetary policy. In 2024, the statutory deposit reserve ratio and the central bank's policy interest rate will be reduced by 1 percentage point and 0.3 percentage point respectively, and the loan interest rates for small and micro enterprises will steadily decline accordingly. The State Administration of Financial Supervision has taken the lead in establishing a working mechanism to support the financing coordination of small and micro enterprises and guide credit funds to reach the grassroots quickly; in the first two months of 2025, the average interest rate of newly issued inclusive small and micro enterprise loans nationwide was 4.03%, a decrease of 0.33 percentage points from 2024, and a cumulative decrease of 3.9 percentage points since 2018. The latest data from the "Inclusive Finance-Small and Micro Enterprise Index" also shows that the financing price index of small and micro enterprises continued to decline to 66.73 points in the first quarter of 2025, a decrease of 2.08 points from the previous quarter and a decrease of 3.86% year-on-year, which is at a low level.
In May 2025, my country launched a package of financial policies to "stabilize the market and stabilize expectations". The statutory deposit reserve ratio and the central bank's policy interest rate were again reduced by 0.5 percentage points and 0.1 percentage points. The State Administration of Financial Supervision issued the "Notice on Providing Financial Services for Small and Micro Enterprises in 2025" (hereinafter referred to as the "Notice"), striving to achieve "maintaining quantity, improving quality, stabilizing prices, and optimizing the structure" of financial services for small and micro enterprises. It is worth noting that the "Notice" emphasizes "reducing the actual comprehensive financing costs borne by small and micro enterprises." At the same time, the People's Bank of China's "China Monetary Policy Implementation Report for the First Quarter of 2025" (hereinafter referred to as the "Report") also proposed in a column "promoting the reduction of comprehensive financing costs for small and medium-sized enterprises."
The comprehensive financing costs of corporate loans can be divided into interest costs and non-interest costs. After multiple rounds of interest rate cuts, corporate interest costs have reached historical lows; at this time, non-interest costs including mortgage fees, guarantee fees, intermediary service fees, etc. have gradually become an important element worthy of attention in reducing the comprehensive financing costs of small and micro enterprises. Non-interest costs involve multiple charging entities, with multiple, opaque, and layered charges, causing the financing costs actually perceived by the enterprise to be higher than the interest costs. Small and micro enterprises have small scale, low credit rating, and weak risk resistance. Banks are more strict in loan approval for small and micro enterprises and are more inclined to provide short-term loans. Short-term loans will increase the capital turnover pressure of small and micro enterprises, forcing them to frequently pay various handling fees and management fees. In order to obtain long-term loans, some small and micro enterprises are forced to turn to higher financing cost channels such as small loan companies and private loans.
In order to maintain the intensity of loans to small and micro enterprises, it is imperative to reduce comprehensive financing costs. Explicitly stating the comprehensive financing costs is a prerequisite. Starting from September 2024, the People's Bank of China has piloted the work of clearly indicating the comprehensive financing costs of corporate loans in the five provinces of Shanxi, Jiangxi, Shandong, Hunan, and Sichuan. The bank will work with enterprises to fill out the "Comprehensive Financing Cost List of Corporate Loans" (i.e., "Loan Clear Paper") to clearly, truly, and comprehensively display the comprehensive financing costs of corporate loans, and improve financing transparency and adaptability. The "Report" disclosed that as of the first quarter of 2025, the pilot areas have completed the work of expressing comprehensive financing costs for 270,000 loans worth 1.53 trillion yuan. Guarantee fees are the “biggest part” of non-interest costs, and reducing comprehensive financing costs can start from the guarantee rate. At the beginning of 2025, the Ministry of Finance and other ministries and commissions jointly issued the "Administrative Measures for the Development of Government Financing Guarantees", proposing that local governments should support the development of government financing guarantee institutions in various ways; government financing guarantee institutions should operate with guaranteed capital and low profits, reasonably charge guarantee fees, and increase the credit of financing for small and micro enterprises.
Reducing the comprehensive financing costs of small and micro enterprises is a systematic project. Incremental policies such as the "loan clear paper" and the development of a government financing guarantee system have provided strong support for banks to expand loans to agriculture-related, small and micro enterprises and private enterprises. The effective reduction of non-interest costs will encourage the release of credit demand of small and micro enterprises, and at the same time help maintain the effective supply of credit to small and micro enterprises.
(Author: Bian Yang, researcher at Beijing Institute of Opening up, w88 casino; Pei Yining, doctoral candidate at China w88 casino of Finance, w88 casino)
Attached original text link:
https://www.cnfin.com/zs-lb/detail/20250702/4261292_1.html
