Yinzhou Loan Balance to Break One Hundred Million Yuan

Details

Category: Governmental News

Published: Tuesday, 20 March 2012 13:13

The difficulty and expensiveness of financing has always been a tough problem for those small and micro businesses. Small Loan Guarantee and Insurance(SLGI for short), which is co-organized by the government, banks and insurers to solve the inadequate mortgage guarantee in financing among small and micro businesses, has become an effective way to help the small enterprises in financing. Up till the end of this February, the urban and rural SLGI balance has reached 120 million yuan in Yinzhou District, exceeding one hundred million Yuan for the first time, benefiting more than 200 small and micro-enterprises.

Lacking of collaterals has been a major bottleneck encountered by small micro-enterprises in financing whereas mortgage guarantee is the main method of loans. The Small Loan Guarantee and Insurance in Yinzhou was introduced in August, 2009. As an insurance product to provide guarantee for microcredit borrowers, SLGI, with the principle of insurance and guarantee, allows those micro-enterprises in accordance with certain conditions, even if unsecured and not guaranteed, to get a certain amount of loan as long as the appropriate insurance coverage is granted.
“My enterprise is a typical example in Yinzhou, with a leased land, a self-built factory and no Property Certificate, we cannot get mortgage financing according to the provisions of the bank.” said Xu Guanghai, general manager of Yinzhou Chuangjie Automation Machinery Parts Co., Ltd. With such issues as the rising prices of raw materials, slow capital returns and the alike, the company faced a serious problem of advance disbursement.
The PICC Yinzhou branch has established small loan guarantee and insurance cooperative relations with Chuangjie, thus Chuangjie can obtain a one-year loan of one million yuan.
In addition to financing difficulties, high cost of financing is another problem for mirco-enterprises. A relatively low cost of financing is another favorable advantage of the Small Loan Guarantee and Insurance.
Currently, most banks in Yinzhou District and the PICC, CPIC and other insurance companies can offer this service.