Bumpy Road Ahead for Consumer Loan Firms

By staff reporter Zhang Man

(.com.cn) After years of preparations, consumer finance firms are about to start trial operations in China under a policy initiative aimed at stimulating domestic demand.

Consumer lenders do not collect deposits but instead provide small loans to Chinese residents. Car and mortgage loans will be excluded from the initial trial.

One lender in Beijing, Shanghai, Tianjin and Chengdu each will be selected for the trial. If the trial is successful, more cities will be allowed to join the program. The China Banking Regulatory Commission did not specify the length of the pilot program.