The People’s Bank of China, the central bank of the People’s Republic of China, and PlaNet Finance, a France-based nongovernmental organization, plan to carry out a study on “Expanding the Short and Medium Term Notes Market to Microcredit Companies in China.” The purpose of the research is to upgrade risk management in Chinese microfinance. The reports are planned for publication during 2012 [1].
Although China’s micro-, small, and medium-sized enterprises (MSMEs) reportedly make up 90 percent of enterprises in the country, these companies are generally excluded from the formal banking sector, and thus rely on microcredit for funding. While the current regulatory framework does not allow microcredit companies to take deposits, the Chinese government is looking to expand other channels of microfinance funding [1].
By Natalie Baer, Research Associate
About the People’s Bank of China: The People’s Bank of China is the central bank of the People’s Republic of China. It is responsible for designing and implementing monetary policy. In 2000, the People’s Bank of China established Rural Credit Cooperatives, which are a significant source of microcredit in China. The People’s Bank of China has also established government-run microfinance institutions in six provinces on a pilot basis.
About PlaNet Finance: Founded in 1998 in Paris, France, PlaNet Finance is a nongovernmental organization (NGO) with the mission of alleviating poverty through microfinance. PlaNet Finance is active in approximately 80 countries as of 2012 and is comprised of nine for-profit and nonprofit units: PlaNet Finance Advisory Services, which provides technical and advisory services; Planet Rating, a microfinance rating agency; PlaNIS responsAbility SAS, which specializes in advisory services and structuring and managing microfinance funds; MicroCred, an investor in microfinance; PlaNet Guarantee, which specializes in microinsurance; FinanCites, a social venture capital company; PlaNet University, a microfinance training provider; and MicroWorld, an internet-based platform allowing the public to make small loans for the benefit of microentrepreneurs.
Sources and Additional Resources:
[1] Information provided to MicroCapital by PlaNet Finance
MicroCapital story, February 22, 2012, “MICROCAPITAL BRIEF: Number of Microfinance Institutions in China Hits 4,282” https://www.microcapital.org/microcapital-brief-number-of-microfinance-institutions-in-china-hits-4282/
MicroCapital story, March 5, 2012, “MICROCAPITAL BRIEF: Ghana Shea Value Chain Initiative Employs 3,500 Women; Aims to Reach 5,000, Build Processing Factory” https://www.microcapital.org/microcapital-brief-ghana-shea-value-chain-initiative-employs-3500-women-aims-to-reach-5000-build-processing-factory/
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https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=PlaNet+Finance
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