Collection of News Reports and Product Innovation Media Coverage

Article excerpt: Nearly 45,000 self-employed businesses and small family workshops sprang up in Luqiao more than ten years ago. They, in desperate need of financial services with small amounts, short term and fast turnover, often have no access to loans. A business manager at Tailong Urban Credit Union recalled that when the state-owned commercial bank made a loan of 10,000 yuan and 100 million yuan, the transaction cost was roughly the same. The “short, smooth and fast” financial needs of SMEs, which were of little value for state-owned commercial banks, meant a huge market for private capital. In 1988 and 1993, with six or seven people and hundreds of thousands yuan, Ginza Credit Union and Tailong Credit Union were established successively. In order to “seize” the market, the two financial institutions had to provide efficient services, such as the “from 7a.m. to 7p.m.”work time, only 5 minutes to transfer small loans to clients’ accounts from 50,000 to 100,000 yuan, and half an hour to approve and transfer 500,000 yuan. The problem of credit and guarantee is the most troublesome for banks when granting loans to SMEs without a complete financial management system. To solve this problem, the local government took the initiative to “provide assistance” and the two private financial institutions also “explored effective measures”. The Government of Luqiao District took the lead to set up a service center for SMEs, as well as policy-based guarantee companies in towns and communities to help or act on behalf forms to handle procedures such as insurance, notarization and evaluation together with private commercial guarantee agencies, so as to shorten the period for loan granting. Each of the two private financial institutions has more than 100 account managers, accounting for one third of the total number of employees. Most of them are natives of Luqiao, and their assessment performance is directly linked to the loan qualification they are responsible for. Thus they shuttle through the streets and alleys of Luqiao every day, initiatively go into enterprises, impartially evaluate credit risks, and actively explore opportunities for credit growth.