Banks call for greater incentives

Leading banker urges government to relax some level of requirements

Amid strong policy signals to pump more money to support small and medium-sized enterprises, banks are calling for more tolerance for bad loans and more incentives to increase banks' willingness to issue more credit to companies struggling to meet loan demand.

While the central government has issued a number of guidelines to broaden financing channels for SMEs to better stabilize growth, "banks lack strong motives to issue credit to SMEs because they are wary of bad loans. Borrowers of such kind have relative weak financial management capacity and ability to resist risks," said Zhang Gengsheng, vice-president of China Construction Bank Corporation, during the China Banking Development Forum held by Sina on Thursday.