BEIJING (Reuters) - China's banking and insurance regulator said it would enhance credit support and lower the actual financing costs of small and micro enterprises this year to better support economic recovery.
In a statement on Thursday, the China Banking and Insurance Regulatory Commission (CBIRC) said financial institutions should provide reasonable credits to small businesses, while preventing the risk of "over-lending".
The CBIRC said it aims to improve the quality of financial services for small and micro enterprises, to promote market vitality and boost confidence.
Financial institutions should price lending rates reasonably based on the benchmark loan prime rate and the characteristics of small and micro businesses, it said.
The CBIRC added that it would optimise the credit structure for small businesses and meet reasonable financing needs of small businesses with a credit line above 10 million yuan ($1.44 million).
The regulator also said financial institutions should not renew loans for non-business and production purposes, and that
financial institutions should not cover up credit risks with loan renewals.
($1 = 6.9227 Chinese yuan renminbi)