The Chinese government's measures to cool the economy have further restricted the already limited financing channels for small- and medium-sized enterprises (SMEs), forcing them to seek loans from non-banking sources at rates as high as 45%, according to a report in the China Business Post.
Beijing has stepped up its efforts since April to rein in an economy that grew at 9.1% last year, and 9.8% year-on-year in the first quarter, to avoid a hard landing.
Measures include raising the deposit reserve requirements for commercial banks and issuing guidelines on lending to curb investment in some overheated sectors such as real estate, auto, steel and cement.
As a result, many commercial banks, which were eager to offer loans at discounted rates last year, have now begun to tighten lending particularly to SMEs, the newspaper said, citing industry sources.
