Easier Financing
Top banking and taxation authorities have pledged to further deepen their collaboration and provide more concerted support for private and small firms.
To better alleviate enterprises’ financing difficulties, efforts will be made to help them turn taxation credit into financing credit, said a recent notice jointly issued by the China Banking and Insurance Regulatory Commission and the State Taxation Administration.
A direct link between taxation and banking data should be promoted while banks should be encouraged to upgrade their credit products, said the notice.
In the meantime, local taxation and banking departments must ensure data security and confidentiality to protect enterprises’ business secrets.
Banking and taxation authorities launched the interactive mechanism in 2015 in a bid to solve the information asymmetry during the fundraising activities of small companies.
From 2015 to the end of September, banking institutions had issued about 1.57 trillion yuan ($224.5 billion) of loans to small and micro firms with good credit nationwide, and the figure stood at 393.9 billion yuan ($56.2 billion) in the first three quarters of this year, up 18.6 percent year on year. in 2023, a report by global market intelligence firm IDC showed.
There will be a compound annual growth rate of 65.7 percent from 2018 to 2023, the company estimated.
In 2019, most of the country’s blockchain spending went to the banking sector, while discrete manufacturing, retail, professional services and process manufacturing were also among the top industries for such investment.
A transformative technology that features an immutable data record that can be used and shared within a decentralized and publicly accessible network, blockchain has various application scenarios including cryptocurrency.
During a study session of the Political Bureau of the Communist Party of China Central Committee in October, the top Party leadership underscored the important role of blockchain technology in the new round of technological innovation and industrial transformation, urging more efforts to quicken development in the sector.
The official recognition will push the application of blockchain technology and power quick spending growth in the sector, said Xue Yu, an IDC researcher.