Lee fengwen
Reducing the cost of integrated financing for micro-enterprises is one of the topical issues of current market interest. Recently, the superintendence of financial supervision issued a circular on good performance in financial services for small microenterprises 2025, which states that the overall objective of the financial services for small microenterprises in 2025 is “conservation, quality, price stability and structure”, helping to stabilize expectations, stimulate dynamism and promote a sustained economic recovery。
It is important to know that the cost of integrated financing for micro-enterprises includes both interest and non-interest costs. As interest rate market reform advanced, the market offer rate (lpr) went down markedly and the weighted average interest rate on enterprise loans continued to be historically low. In march this year, lprs for one year and for more than five years were 3. 1 per cent and 3. 6 per cent, respectively, representing a decrease of 0. 35 percentage points over the same period. In march, the weighted average interest rate on new loans was around 3. 4 per cent, a decrease of about 0. 6 percentage points over the same period. For micro-enterprises, the average national interest rate on new inclusive micro-enterprise loans was 4. 03 per cent in the first two months of the year, a decrease of 0. 33 percentage points compared to 2024 and a cumulative decline of 3. 9 percentage points since 2018。
However, in the context of historically low interest rates on loans, enterprises still feel that the cost of financing is too high, owing to higher non-interest costs. Non-interest costs, i. E., financing costs, including mortgages, guarantees, intermediary services, etc., remain relatively high in some enterprises because of the multiplicity of fees involved and the variety and opacity of fees, which are not as clear as loan rates. To this end, the general directorate of financial supervision has made it clear that “stable prices” should not only stabilize the prices of credit services, guide the strengthening of the pricing of loans, rationalize the level of interest rates on inclusive micro-enterprises, but also deepen the use of financial technology to reduce operating costs while regulating cooperation with third parties to reduce the cost of integrated financing。
To reduce the cost of integrated financing by enterprises, enterprises should be made aware of what they charge at the time of lending. Since september 2024, the central bank has been piloting an explicit cost of integrated financing of enterprise loans in the five provinces of shanxi, jiangxi, shandong, hunan and sichuan. The bank, in conjunction with the enterprises, will complete a list of the cost of integrated financing of enterprise loans (i. E., “loan paper”), write down each item of the interest and non-interest costs incurred by the enterprise in obtaining loans, convert the adultization rate in a uniform way, and present the cost of integrated financing of enterprise loans in a clear, realistic and comprehensive manner. A “loan note” shows the full cost of financing the enterprise. As of the end of march 2025, the pilot areas had completed the work on the explicit consolidated financing cost of 270,000 loans of $1. 53 trillion。
Harmonizing the various types of financing costs through “loan paper” would not only enable enterprises to identify the various charges and their subject matter, improve the “transparency” of financing, guarantee the right to know, but also give businesses a clear picture of whether they have fully enjoyed preferential policies and what scope for relief or a reasonable reduction in the cost of financing through negotiation would help to reduce financing costs。
In the view of the author, reducing the cost of integrated enterprise finance in a context where the non-interest fees on enterprise loans are numerous and account for a larger share of the overall cost of financing than the cost of interest requires a multi-stakeholder effort to optimize the corporate financing environment。
On the one hand, banking institutions need to change the concept of business and establish a reasonable price for credit. The management of loan pricing is to be strengthened by scientifically determining the level of interest rates for enterprise loans and enhancing the sustainability of business development on the basis of the interest rate on loan market quotations (lpr), the cost of its own funds and the characteristics of its small microentrepreneurs, risk profile, etc. It is necessary to strengthen the capacity of technology by making full use of scientific and technological tools, such as big data, cloud computing and artificial intelligence, and to build specialized systems, upgrade the level of business intensive management, improve the efficiency of wind control and reduce operating costs. At the same time, banks need to remove hidden barriers to private and micro-enterprise financing, constantly innovate financial products, simplify business processes and provide msmes with financial services adapted to their business characteristics. It also regulates cooperation with third parties, enhances autonomous service capacity, improves customer access, shortens the financing chain and reduces the cost of integrated financing actually borne by micro-enterprises。
On the other hand, banks should also strengthen their cooperation with the financial sector, guarantee agencies, etc. In the financing of service enterprises, in order to solve the problem of financing. Local governments, finance and others also need to be proactive in reducing fees and creating synergies to work together to reduce the burden of corporate finance。
More importantly, enterprises need to strengthen their own credit-building, improve their internal management and financial systems, maintain and enhance their credibility and provide a solid basis for further reducing financing costs。
