Loans Granted to SMEs During Government Organized Symposium
At a government organized finance symposium yesterday, six SMEs signed contracts with banks that approved their loans amounting to 212 million yuan, plus a loan a 100 million yuan in credit. Nearly a thousand enterprises, thirty banks, ten venture capitalists, warrantors and small-loan companies were in attendance at the symposium.
Getting loans for SMEs has become harder as most banks are tightening loan releases in fear of inflation, thus giving SMEs worldwide difficulty in financing their businesses. One construction company said that cost of human labor and materials are increasing steadily and they cannot raise their prices because of competition, getting loans from banks will definitely help them.
A bank representative said that most SMEs have a hard time getting loans because they lack accounting and collateral. This is because most SMEs only have no more than a hundred employees and no factories. Shenzhen’s SMEs service center showed that 82 percent of the SMEs in the city needed cash, but only 6 percent of them got loans from banks.
Despite financial difficulties in Shenzhen, SMEs in Shenzhen are doing well and in the 4,000 companies that are registered about half of them have closed down.