Banking Industry in China: More regulations for being socially responsible

15 February 2012 - CSR Asia, Brian Ho

Since the second half of 2011 there have been various news reports about the difficulties for companies, especially small and medium sized enterprises, to receive business loans in China due to a tightening of bank policy. Some banks have been criticised for increasing the interest rates through different measures and causing SMEs in China to go for usurious loans. There are some cases where business people have committed suicide or have become “runaway bosses” as they cannot repay the business loan. However, when comparing the banking industry with other industries, profit in the financial sector is maintained at high level. Criticism about the social responsibility of banks, especially state-owned ones, has appeared in mainstream media and the public has come to the consensus that banks should be more socially responsible and support those companies and local economies that need help. CSR has become an important agenda for the banking industry. Read More.