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Professor Guo Tianyong at School of Finance of Central University of Finance and Economics
According to the “Economic Daily-PSBC Small and Micro-sized Enterprise Operating Index” (hereinafter referred to as “SMEOI”) in December, the general index of small and micro-sized enterprises (SMEs) in the month reported 46.5 points. Seen from the annual performance since the release of SMEOI in May, the index, despite the slight fluctuation, has basically remained below the purchasing managers’ index. It reflects that SMEs in China still operate under pressure, which just echoes with the macroeconomic data and indicates that SMEOI can help estimate or proof the macro data to some extent.
Viewed from sub-indices, the current operation of SMEs mainly has the following three features: (1) Better than expected. The market index of 43.8 points in December increased somewhat compared with the last month, and the performance index of 45.8 basically equaled to the last month, which indicates that the operating downturn of SMEs has eased to some extent despite the fact that companies suffer from financing difficulty at the end of the year. (2) Still falling short of market confidence. The purchasing index, the expansion index and the confidence index dropped to some extent compared with last month. (3) With financing cost rising and. financing amount to be improved, the financing index fell by 0.3 point compared with last month.
Against such backdrop, how to lower SMEs’ financing cost has attracted tremendous attention from all sectors of the society. In the “13th Five Year Plan”, the central government put it clearly to “speed up the reform on financial system, improve economic efficiency of financial service entities, construct multi-level, widely covered and variant banking institutions, divert more private capital to the banking industry, and develop inclusive finance by providing more financial service for medium, small and micro-sized enterprises, rural areas and poverty-stricken areas particularly”. In the view of author, SMEs will need more favorable policies and exclusive financing channels.
Firstly, update financing services for SMEs by means of Internet. The Internet finance has its internal advantages in serving SMEs: (1) Free from the time and space limitations confronting traditional banking business, it can provide financing services for customers anytime and anywhere. (2) Its huge customer base highlights the economy of scale and drives down the customer service marginal cost low-enough and even close to zero. (3) With intelligent technologies, banks are able to continuously track the conditions of customers with unprecedented accuracy. For example, such customer information as spending preference, regional differences in market and demand fluctuation enable banks to more accurately evaluate prospective earnings, asset value and overall business value of customers, and help customers perfect market fixed price and achieve precision marketing, so as to effectively address the problem that SMEs may incur uncontrollable risks but bring relatively low incomes. Therefore, the traditional commercial banks need to timely pool business resources and launch online banking and mobile banking products designated for SMEs, which feature simplified query, payment and wealth management processes, and provide comprehensive financial services integrating enterprise information management and personal wealth management. Certainly, we should bear in mind that, in any case, the Internet or big data is only a kind of technology or tool, and any innovation shall respect the nature of finance and be aimed to serve customers’ industrial development.
Secondly, strive to develop direct financing, especially bond financing. To make financing more accessible to SMEs, more diversified financing modes shall be introduced, in addition to innovations in policies, products and services by commercial banks. Under the macro background of economic downturn, considering the information asymmetry between banks and enterprises, moral hazards and other factors, commercial banks may reduce loans or be afraid of extending loans, which further reduce the possibility for SMEs to get loans. Such problem can be satisfactorily solved in the bond market. In the case of direct bond issuance by enterprises, the borrowing and lending channels between closely contacted market entities will be opened up, allowing the borrower to better supervise the lender. Although China’s inter-bank bond market is taking on a growing size, it still takes time to include SMEs into the market. At present, efforts may be focused on developing regional and industrial bond markets, so as to improve the bond-based financing amount of SMEs.
Thirdly, launch special loans and funds for companies engaged in mass entrepreneurship and innovation as soon as possible. These companies will give important impetuses to the future economic growth and also constitute an important part of SMEs. It is fair enough to give them more preferential financial policies. To be specific, credit lines with flexible maturities and prices and special funds for supporting the growth of innovative SMEs will be put in place to facilitate the investment and financing activities with matched risks and benefits.