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
Topic |   China economy

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The American Economic Association estimates that 80 per cent of privately owned Chinese firms have received funds from informal channels. Photo: AP
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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’
Topic |   Two Sessions 2019 (Lianghui)

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Shadow banking is a major source of funding for smaller private firms in China that cannot get credit from traditional lenders. Photo: Reuters
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