Partnership to develop financial products and services to expand HSBC’s financing capabilities to China’s rural communities
HSBC, in partnership with Women’s World Banking (WWB), a network of microfinance institutions and banks, has launched a new “individual lending” product. Reportedly, it is an unsecured small business loan tailored to meet the financing needs of farmers and small businesses in rural China – reported The Asian Banker.
WWB is providing technical support to HSBC, training local staff in managing and servicing a portfolio of farmers and small businesses and creating tailored financial products and services to address the specific needs of the country’s rural areas. The new individual lending product relies on an analysis of an applicant’s business and cash flow, whereby the financial needs and repayment capacity of the client are considered when structuring the loan.
The new loan product has been piloted over the past three months at Hubei Suizhou Cengdu HSBC Rural Bank, HSBC’s first rural bank, which opened in December 2007. The product has since been launched at a second HSBC rural bank in Chongqing Dazu, with plans to roll the product out across all HSBC rural banks. As commercial operations, HSBC’s rural banks aim to be viable, profitable and sustainable businesses, while meeting the needs of China’s rural communities.
Vincent Cheng, chairman of HSBC, said: “We are very pleased to be able to extend our financial services to farmers and small rural businesses in China through the launch of the individual lending product. As the first international bank to enter the country’s rural market, HSBC is leveraging its international experience and partnerships to tailor suitable products and services for rural communities in China.”
Mary Ellen Iskenderian, president and CEO of WWB, said: “Expanding access to financial services for those who live in rural areas is vital to supporting rural economic development in China as well as empowering farmers to increase their productivity and ability to generate income. WWB has brought our international experience in designing innovative financial products and services to China and has welcomed the opportunity to support HSBC’s rural banking services on this initiative.”