The American Economic Association estimates that 80 per cent of privately owned Chinese firms have received funds from informal channels. Photo: AP
Is China about to bring shadow banking back out of the darkness to kick start its slowing economy?
- Government crack down on debt and risky lending also eliminated legitimate funding channels for smaller private sector businesses
- Government pledging more support for fund smaller businesses, but private sector remains sceptical
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China economy
The American Economic Association estimates that 80 per cent of privately owned Chinese firms have received funds from informal channels. Photo: AP
Shadow banking is a major source of funding for smaller private firms in China that cannot get credit from traditional lenders. Photo: Reuters
China to ‘strike a balance’ between good and bad shadow bankers to halt fall in growth
- Shadow banking refers to financial activities conducted by unregulated lending institutions or off-balance-sheet activities by traditional financial institutions
- Wang Zhaoxing, vice-chairman of the China Banking and Insurance Regulatory Commission, considering ‘benefits the real economy’
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Two Sessions 2019 (Lianghui)
Shadow banking is a major source of funding for smaller private firms in China that cannot get credit from traditional lenders. Photo: Reuters