Shandong approves 5 solo investment small loan companies

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Shandong recently approved 28 small loan companies, including five sole proprietorship companies, according to the Finance Office of Shandong Province. It is the first time that Shandong has approved sole proprietorship companies in small loan businesses.

Among them, United Asia Finance Small Loan Company, owned by United Asia Finance Limited ("UAF"), is the first foreign investment small loan company with a registered capital of 300 million yuan (US$48.9 million).

In November of 2013, the Shandong government released a notification encouraging the setup of small loan companies. Companies are allowed to set up solo investment small loan companies if they possess proof of 5 billion yuan (US$ 814.9 million) in total assets, and the asset-liability ratio is not higher than 65 percent. Companies should gain profit for two continuous years before applying.

By 2013, Shandong had set up 365 small loan companies which distributed more than 118.72 billion yuan (US$19.3 billion) for agricultural loans and small and micro-enterprise loans.

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