Wenzhou unveils financial reform details

Specifics of China's pilot financial service reform were released on Friday as the first bond issuance by a loan company in Wenzhou, Zhejiang province, proved successful.

The new policies focus on bond financing for legally registered small loan companies.

Announced by the Wenzhou government, the policies are designed to govern the operation of the city's private lending registration service center, small and medium-size enterprise financing service center, and other financial facilities.

"We are planning to launch the private lending service center by introducing authorized agencies for lending registration, contract notarization and assets appraisal registration," said Zhang Zhenyu, director of the city's financial office.

In addition, he said, Wenzhou is about to introduce its index for private lending as early as late this month, to be accompanied by publicly available information updates and risk warnings.

Wenzhou, which boasts one of the densest clusters of private enterprises in China, was selected for the pilot reform after a local financial crisis featuring widespread factory closures because of dwindling orders from overseas and rising interest services charged by underground lenders.

The reform is aimed at building the city into a prosperous but well-regulated financial service center capable of meeting the needs of local entrepreneurs.

Central government officials expect the Wenzhou reform to serve as an example for similar changes that they may recommend across the nation.

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