Xiangzhou District, Zhuhai

A large number of rewards and subsidies, combined with a new secured lending system sharing risks among the government, banks, guarantors and enterprises will provide stimulus for Xiangzhou's financial development.

The added value of the financial sector in Xiangzhou was more than 11.5 billion yuan ($1.7 million) last year, accounting for about 70 percent of that in Zhuhai. The district held a GDP share of more than 10 percent, a 9.2 percent increase year-on-year.

The Xiangzhou government recently announced new measures to promote its financial development through specified incentives, funds and other policy support to further advance the financial industry.

Risk-sharing secured lending system 

Thanks to a new specially designed lending system, approximately 40 to 60 sci-tech small and medium sized enterprises (SMEs) will acquire better loan access, with each able to borrow up to 5 million yuan ($727,275).

The government, local banks and guarantee organizations will jointly bear loan losses by a ratio of 20 to 50 percent under the new system. 

The Xiangzhou government has so far worked with 10 banks, such as Bank of China, and two guarantee institutions including Zhuhai Small & Medium Enterprises Financing Guarantee. The total amount of government loan risk compensation will hit 20 million yuan ($2.9 million). The expected total of money to be lent ranges from 200 million ($29 million) to 300 million yuan ($43.6 million).

Three-hundred and sixty-one enterprises having been included among a beneficiary list, with eight succeeding in borrowing a total of 22.1 million yuan ($3.2 million) after obtaining loan approval.

To ensure fair growing opportunities, the Xiangzhou government even introduced policy aimed at bad loans. Commercial banks can enjoy 50 percent risk premiums for the losses resulting from unsecured SMEs.

Financially encouraged expansion 

Enterprises involved in R&D, manufacturing and new high-tech products services will be awarded subsidies to cover insurance, security costs and fees coming from fixed assets and intellectual property valuations. The maximum grant for a single enterprise is 250,000 yuan ($36,352). 

Listed companies will receive a bonus ranging from 200,000 yuan to 3 million yuan based on respective company markets, according to the measures issued last year on awarding Xiangzhou's listed companies.

The New Year's policy decided that additional money will be allocated to enterprises involved in a merger or acquisition.

The district's financial service center will establish special funds for equity investment institutions.

Through exploration of the new funding mode, Xiangzhou has cooperated with Zhuhai Financial Investment Group and the Tsinghua Science Park to provide venture capital and angel investment funds. 

Currently, the Huajin Fund has 77 million yuan ($11.2 million) now available in its first investment phase of 152 million yuan ($22 million). The government supported fund is aimed at the growth of emerging industries such as bio-medicine, big data and new energy.

Financial cluster to be built

Home to 33 banks, 36 securities companies and 51 insurances, Xiangzhou will welcome one or two new entrants. According to the latest policy, headquarters with a financial business license and a finance-targeted service platform with a building area no less than 8,000 sq km will be rewarded or subsidized.

Moreover, the government plans to continue to upgrade its financial street by adding more financial input and venture resources. Xiangzhou's currently financial street is home to 26 enterprises employing almost 350 employees, and reached assets in total of 3.4 billion yuan ($494.6 million) by the end of 2016.

Xiangzhou's financial street will upgrade to financial cluster for innovation and entrepreneurship. [Photo / Zhuhai Daily]