China will shorten the time it takes to process licensing applications for privately owned banks as the government seeks to step up funding support for small businesses to bolster the economy.
The China Banking Regulatory Commission will allow its local branches to approve the applications and cut the processing time to four months from six, Chairman Shang Fulin said at a briefing in Beijing on Friday. The regulator will start reviewing more than 40 applications, he said.
“This is an effort by the CBRC to discipline itself and to improve the efficiency of the review and approval process,” Shang said. “Promoting privately owned banks fits China’s needs. Small businesses still face difficulties in getting funding.”
The government is seeking to bolster smaller businesses, which account for 60 percent of gross domestic product, in an attempt to bolster an economy poised to grow this year at the slowest pace since 1990. China is trying to boost the role of markets in a state-run banking industry that has $29 trillion of assets, almost twice the amount of its U.S. counterpart.
The country’s State Council, or cabinet, revealed plans on Wednesday to end a two-decade-old rule that has capped lending at 75 percent of deposits.
The government is also allowing more competition into the banking industry: Billionaire Jack Ma’s Alibaba Group Holding Ltd. this week started MYbank, an online lender that is seeking to tap into Chinese savings.
— With assistance by Aipeng Soo