The United Nations 2030 Agenda for Sustainable Development covers 17 goals, the ninth of which is "Industry, innovation and infrastructure", namely: build resilient infrastructure, promote sustainable industrialization and foster innovation. 

Under this major goal, there are eight targets, the third of which is "increase the access of small-scale industrial and other enterprises, in particular in developing countries, to financial services, including affordable credit, and their integration into value chains and markets".

● Current Situation

About the World

Financing Gap for SMEs

The financing gap for small, medium and micro enterprises in developing economies is very serious. According to a research report by the World Bank in 2017, the potential financing needs of small, medium and micro enterprises in developing economies were estimated at US$8.9 trillion, while the supply of credit is US$3.7 trillion, with a gap of US$5.2 trillion, and the gap in East Asia and the Pacific was 23,000. Billion US dollars, accounting for 52% of the world’s total gap.

Photo source: zh.al-ain.com

In many countries, the small, medium and micro financing gap accounts for more than 20% of the national GDP. The proportion of enterprises whose development is restricted by capital shortages is about 27% in upper-middle countries and about 67% in low-income countries.

Text source: thepaper.cn

About China

China Vigorously Supporting SMEs

Photo source: baidu.com

Small and medium-sized enterprises occupy a key position in the industrial chain, but their ability to resist risks is generally low, and they are also more affected by the new crown epidemic. Since the outbreak of the COVID-19 pandemic, China has introduced a series of measures including tax cuts and fee reductions, rent reductions and exemptions, and new preferential interest rate loans, etc., to step up efforts to help small and medium-sized enterprises.

Text source: paper.ce.cn

●  Cases

About the World

Policy Financial Institutions for SME Financing in France

French main policy financial institutions supporting the financing of SMEs are the BPI Financial Group under the French Public Investment Group (EPIC BPI) established in December 2012 and the French Small Business Mutual Guarantee Corporation (SIAGI). They help SMEs obtain bank credit and equity financing, and provide related consulting services. The BPI Financial Group was funded and established by two public law institutions, the French Public Investment Group and the French Deposit Entrustment Fund. The group established two institutions, "BPI Investment" and "BPI Financing". The main task of SIAGI is to provide financing guarantees for small businesses.

Photo source: baidu.com

France supports SME financing focusing on entrepreneurship and innovation. "Innovation Loans" are specifically designed to support the commercialization of new products for small and medium-sized enterprises. The amount is 30,000 to 1.5 million Euros and the term is 7 years.

Text source:  thepaper.cn

Japanese Social Forces Participating in Financing Services for SMEs

Japan Chamber of Commerce and Industry Central Bank Co., Ltd. is the only policy bank jointly established by the Japanese government and small and medium-sized enterprises, which specializes in providing financing services for small and medium-sized enterprises. Japan’s policy financing system focuses on the participation of social forces and organizes qualified non-profit organizations to participate in the SME support institution system.

Photo source: dwnews.com

The local government provides certain financial subsidies to the enterprise service centers established by the two chambers of commerce, the Chamber of Commerce and Industry and the Chamber of Commerce and Industry. The "management instructors" and "bookkeepers" of these organizations provide free management consulting services for all member companies in their jurisdictions , Management instructors are all certified by the Japan Small and Medium Business Administration. Banks generally consult the local chamber of commerce before making a loan.

Text source: thepaper.cn

About China

"Financial Ark" Helps SMEs in Shenzhen

The COVID-19 pandemic inevitably impacts the production and operation of enterprises, hinder the circulation of the industrial chain, and has a negative impact on the industrial economy. In April 2020, Shenzhen government launched the "Financial Ark" project to help small and medium-sized enterprises solve financing difficulties.

Photo source: 163.com

The project operates in a market-oriented manner, with banks and other financial institutions participating in the principle of voluntary participation, and complying with initiatives such as the concerted action plan. Focus on supporting enterprises at important nodes in the upstream and downstream of the industrial chain, high-quality enterprises in industries such as accommodation and catering, cultural and sports entertainment, transportation and logistics, foreign trade exports, wholesale and retail that are directly affected by the epidemic, and advanced enterprises that have development prospects and have temporary difficulties in capital turnover due to the impact of the epidemic Manufacturing companies.

Text source: ifeng.com

Ping An’s Leasing Small and Micro Finance

In order to alleviate the huge impact of the COVID-19 on the entire industrial production field and small and micro enterprises, Ping An Leasing Small and Micro Finance has established a 7*24 hour service system of "online marketing + online remote due diligence + online automatic approval". The equipment exhibition and sales channel allows 14,000 small, medium and micro manufacturing customers to obtain equipment financing support at the most difficult time, achieve capacity expansion against the trend, and provide financial institutions and government parks with a return to work rate based on the small and micro security index monitored by IOT Important reference.

Photo source: baidu.com

Ping An Leasing’s Small and Micro Financial Business Unit was awarded the “Top Ten Innovative Cases” in Shanghai’s financial leasing industry in 2020. As of the end of November 2020, it has served nearly 31,000 small and micro enterprises, with a total investment of over 35.8 billion.

Text source: ljzfin.com

●  Background

Sustainable Development Goals (SDGs) Initiated by the United Nations

On 1 January, 2016, the 17 Sustainable Development Goals (SDGs), including 169 targets, of the 2030 Agenda for Sustainable Development — adopted by world leaders in September 2015 at an historic UN Summit — officially came into force. Countries will mobilize efforts to end all forms of poverty, fight inequalities and tackle climate change, while ensuring that no one is left behind.