On June 27th, the Red River Supervision Bureau of the State Administration for Financial Supervision and Management issued three fines directly to China Minsheng Bank Co., Ltd. Red River Branch and related responsible persons.

The fine showed that the Red River Branch of Minsheng Bank was fined 300,000 yuan for not providing charging discounts to small and micro enterprise customers.

At the same time, the counter staff of the Red River Branch of Minsheng Bank and the then counter staff of Mile Branch of Minsheng Bank, Mu Qiuxuan, were responsible for the issue of "not providing charging discounts to small and micro enterprise customers" at the Red River Branch of Minsheng Bank, and were both warned.

(Image source: official website of the State Administration for Financial Supervision and Management)

The punishment reason for "not providing charging discounts to small and micro enterprise customers" is the first time. In fact, the state has been promoting the reduction of financing costs for small and micro enterprises by financial institutions over the years.

As early as March 20th, 2014, the People's Bank of China issued the "Notice on the Launch of Supporting Small and Micro Loans and Supporting Expansion of Small and Micro Enterprise Credit" to guide financial institutions to reduce the financing costs of small and micro enterprises. At the same time, a type of "small and micro loans" was established under the category of credit policy support for refinancing. It is specifically used to support the expansion of credit granting to small and micro enterprises by financial institutions, with a total national quota of 50 billion yuan for small and micro loans.

According to the State Administration of Financial Supervision and Management, as of the end of 2023, the loan balance of banking financial institutions for small and micro enterprises (including loans for small and micro enterprises, individual industrial and commercial loans, and loans for small and micro enterprise owners) was 70.9 trillion yuan.

Among them, the balance of inclusive small and micro enterprise loans was 29.1 trillion yuan, a year-on-year increase of 23.3%. The number of customers with inclusive small and micro enterprise loans was 1.467 million, an increase of 44.39% year-on-year. The average interest rate of inclusive small and micro enterprise loans for the whole year was 4.78%, slightly lower.

While the country is helping to support small and micro enterprise loans, it is also requiring financial institutions to strengthen their own collection capacity. And currently, the increase in non-performing loan balances is also an important driving force for financial institutions to shift their collection business to self-employment.