Tuesday, September 13, 2011

Loan Relief for China's SMEs

In the liquidity squeeze, state-run enterprises have been the only companies getting access to credit. Authorities are making noise about providing credit to Small and Medium sized Enterprises.

China to loosen reins on credit for SMEs
Small businesses are finding it tough to obtain loans as commercial banks tighten credit in line with central bank directives.

The situation has led to the emergence of corporate loan sharks - with cash-rich firms, including some listed on the mainland bourses, offering short- term loans charging interest of about 8 percent per month, mainland media reported.

Some rich firms are even offering medium- to long-term loans, sometimes charging interest of more than 30 per cent per year.

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