Shenzhen: Encourage banking institutions to develop exclusive credit products for key industry chains in our city and open up a green channel for financial services.

On March 5th, the Shenzhen Local Financial Supervision and Administration Bureau issued a notice on the implementation of the "Shenzhen Municipal Implementation Opinions on Financial Support for High-Quality Development of Supply Chain". The implementation opinions encourage banking institutions to develop exclusive credit products for key industrial chains in our city and open up a green channel for financial services. They also encourage banks and insurance institutions to deeply engage in supply chain business scenarios, actively provide services based on core enterprises and supply chain service platforms, and rapidly respond to the comprehensive needs of the industry chain such as settlement, financing, and credit insurance. Here is the original text: Notification of the Shenzhen Local Financial Supervision and Administration Bureau on the issuance of the "Shenzhen Municipal Implementation Opinions on Financial Support for High-Quality Development of Supply Chain" To all relevant units: With the approval of the municipal government, the "Shenzhen Municipal Implementation Opinions on Financial Support for High-Quality Development of Supply Chain" is hereby issued to you for implementation. This notice is hereby given. Shenzhen Local Financial Supervision and Administration Bureau March 5, 2024 Shenzhen Municipal Implementation Opinions on Financial Support for High-Quality Development of Supply Chain Shenzhen FinReg [2024] No. 1 In order to implement the spirit of the Central Financial Work Conference, carry out the five major tasks of science and technology finance, green finance, inclusive finance, pension finance, and digital finance, improve the quality and efficiency of financial services to the real economy, and promote high-quality services for the stable development and upgrading of the supply chain and industrial chain in our city, these implementation opinions are formulated. I. Basic Principles (I) Adhere to market orientation. Guided by market demand and in conjunction with the characteristics of industrial chain and supply chain development in our city, fully leverage the decisive role of the market in resource allocation, effectively expand the supply of financial services, and improve the efficiency of financial resource allocation. (II) Adhere to financial inclusion. Focus on the financial services needs of small and medium-sized enterprises in the industrial chain and supply chain, accurately grasp the difficulty and pain points of financial support for supply chain enterprises, and improve the inclusiveness and adaptability of financial services in terms of institutional mechanisms. (III) Adhere to collaborative development. Give full play to the leading advantage of Shenzhen in the development of the supply chain finance, strengthen the horizontal linkage and linkage between districts and cities in the work of financial support for supply chain development, enhance the aggregation of financial elements, promote production-finance collaboration and innovation-finance integration. (IV) Adhere to technological empowerment. Give full play to the advantages of financial technology, actively and prudently regulate the use of financial technology, improve the efficiency of financial services to the industrial chain and supply chain, and reduce transaction costs. II. Work Objectives Promote the establishment of a financial service system that is rich in products and services, has strong policy support, operates efficiently and standardized, and continuously increase the financing scale of small and medium-sized enterprises in the upstream and downstream of the supply chain; strengthen infrastructure construction, promote deep integration of digital finance and industrial entities, and promote supply chain financial services to be scenario-based, ecological, online, and digitalized, enhance the precise financial support capabilities for the industrial chain and supply chain, add no less than 3 new application scenarios on the supply chain financial public service platform each year; tailor the establishment of supply chain financial characteristic parks in various districts according to local conditions, form element aggregation and efficient circulation; strengthen the construction of the supply chain financial standard system, and launch no less than 3 supply chain financial standards before 2029. III. Key Tasks (I) Enhancing the high-quality development of supply chain finance. 1. Improve the service system of financial support for the supply chain. Study and establish a financial regulatory assessment mechanism that supports industry-oriented and inclusive small and micro enterprises. Encourage banking institutions to develop exclusive credit products for key industrial chains in our city, and open up a green channel for financial services. Encourage banks and insurance institutions to deeply engage in supply chain business scenarios, actively provide services based on core enterprises and supply chain service platforms, rapidly respond to the comprehensive needs of the industrial chain such as settlement, financing, credit insurance, etc. Encourage financial institutions, core enterprises, and supporting service institutions to strengthen information coordination and sharing, enrich financial products in various links such as production, circulation, and transaction, support the construction of a digital credit system and dynamic risk control model for small and medium-sized enterprises applicable to supply chain scenarios. Encourage insurance institutions to develop various credit guarantee insurance businesses based on supply chain scenarios. New financial institutions and venture capital institutions that meet relevant conditions will be given settlement awards in accordance with the "Several Measures on Supporting the Development of Financial Enterprises in Shenzhen" (Shenzhen FinReg [2022] No. 2) and the "Several Measures on Promoting the Sustainable High-quality Development of Venture Capital in Shenzhen" (Shenzhen FinReg [2023] No. 3). (Responsible units: Municipal Financial Office, Municipal Market Supervision Bureau, Municipal Industry and Information Technology Bureau, Municipal Commerce Bureau, People's Bank of China Shenzhen Branch, China Banking and Insurance Regulatory Commission Shenzhen Bureau) 2. Innovate the financial support mode for the supply chain according to local conditions. Support Futian District in leveraging its advantages in financial and fintech aggregation, and plan for a specialized supply chain financial platform; support Luohu District in leveraging its advantages in the gold and jewelry industry and commercial trade to create a gold supply chain financial characteristic park; support Nanshan District in leveraging its advantages in scientific and technological innovation to establish a supply chain financial technology innovation demonstration industrial base; support Yantian District in leveraging its port infrastructure and advantages in bonded fueling to innovate the development model of the supply chain financial for large ship equipment and oil and gas trade; support Baoan District in building a supply chain financial service center for advanced manufacturing in the Guangdong-Hong Kong-Macao Greater Bay Area based on the manufacturing industry supply chain; support Longgang District in building a supply chain financial service demonstration platform for cross-border e-commerce in the Guangdong-Hong Kong-Macao Greater Bay Area based on the industrial cluster advantages of cross-border e-commerce; support Longhua in building a digital Longhua urban core industrial ecosystem layout, create a digital financial park for the supply chain of characteristic industries; Support Dapeng New Area in leveraging its advantages in the national projects of the food valley and cultural tourism to create a supply chain financial demonstration base for food and cultural tourism. Support Qianhai in deepening financial cooperation between Shenzhen and Hong Kong, and create a Qianhai-Hong Kong cooperation zone as an innovative base for supply chain financial in the Qianhai-Shenzhen-Hong Kong Cooperation Zone with convenient cross-border capital flow and outstanding industrial financial development capabilities. Support other districts to build characteristic supply chain financial industrial parks based on the actual industrial development. Districts with conditions can formulate support policies to provide rewards and support to operating institutions and enterprises within the industrial parks that meet relevant conditions. (Responsible units: Various districts (new districts, Shenshan Special Cooperation Zone), Municipal Financial Office, Qianhai Administration) 3. Accelerate the digital transformation of supply chain finance and empower financial technology. Encourage financial institutions to accelerate the digital transformation of supply chain financial product services and management, enhance the online capabilities of supply chain financing support and the convenience of payment settlement, and build a digital credit system and dynamic risk control model for enterprises of all sizes based on supply chain scenarios. Support all participants to use financial technologyDrive the visibility, tangibility, and controllability of supply chain transactions. Encourage all types of participants to enhance information sharing and collaborate with financial institutions to develop online and digital supply chain financing products. Support industry associations in researching financial technology application standards and supply chain financing platform technical application norms. Support financial technology companies and supporting service institutions serving the supply chain to participate in the selection of financial innovation awards. For supply chain financial technology institutions that meet the relevant conditions, rewards and support will be given in accordance with the "Several Measures to Support the Development of Financial Technology in Shenzhen" (Shenzhen Financial Supervision Regulation [2022] No.1). (Responsible units: Municipal Party Committee Finance Office, Municipal Science and Technology Innovation Bureau)The second part: Promoting innovative mechanisms for supply chain financial services. 4. Explore the specialized management of supply chain finance. Encourage commercial banks to explore the establishment of specialized institutions, departments, or branches for supply chain finance, and implement differentiated management in product innovation, credit decision-making, performance assessment, tolerance for non-performing loans, and risk responsibility. Encourage financial institutions to optimize the supply chain financing credit model and credit evaluation model in collaboration with core supply chain enterprises, supporting service institutions, and professional research institutions, enrich standardized online products, explore credit products with weak property rights, and promote innovative models across entities, regions, and systems. Support specialized institutions in optimizing product design in specific scenarios, innovate "one-point-for-the-whole-country" service models, and comprehensively coordinate the resources and financing business of the industrial chain supply chain. Encourage insurance, securities, guarantees, and other financial institutions, as well as local financial organizations, to promote specialized management of supply chain finance. (Responsible units: Municipal Party Committee Financial Office, National Financial Supervision and Administration Administration Shenzhen Supervision Bureau, People's Bank of China Shenzhen Branch) 5. Explore the healthy and standardized development of platform-based supply chain finance. Support core supply chain enterprises, supply chain management companies, financial institutions, supporting service institutions, etc., to jointly build financial service supply chain platforms and explore innovative service models for supply chain financing based on data governance and credit transmission under the premise of risk control and compliance operation. Encourage financial institutioThe establishment of a registration platform, a platform for financing services based on credit inquiries, and other basic infrastructure will improve the management of movable property rights, prevent repeated pledges, empty pledges, and self-financing activities based on related transactions or false trade. All financial services in the field of supply chain finance should be provided by financial institutions and local financial organizations to prevent non-financially qualified enterprises from engaging in financial activities under the guise of supply chain finance. Encourage all types of participants to use digital technology to strengthen multi-dimensional cross-validation to prevent the risk of accounts receivable financing and bill discounting without a real trade background. Strengthen risk education in financial security, data governance, technological ethics, and other aspects under digital transformation, and improve risk prevention capabilities. (Responsible units: Municipal Party Committee Financial Office, People's Bank of China Shenzhen Branch, China Banking and Insurance Regulatory Commission Shenzhen Office, Shenzhen Securities Regulatory Commission)12. Strengthen the standard guidance and data governance of the supply chain finance. Establish a multi-level compliance management and supervision system involving financial regulatory departments, local governments, and industry associations, promote cross-departmental information collection, sharing, and institutional coordination, and implement "joint incentives, joint penalties" measures. Research on establishing a dynamic credit evaluation system for supply chain finance, explore centralized management and dynamic monitoring of operational data of supply chain finance. Explore the management mechanism of the white list system for local financial organizations, guide local financial organizations to strictly carry out supply chain financing business in accordance with regulatory requirements. Strengthen the standardized management of data governance in digital transformation. Severely crack down on various illegal and non-compliant activities conducted under the guise of supply chain finance, such as illegal fundraising, fictitious trade, fictitious accounts receivable financing, and abuse of credit. (Responsible units: Municipal Party Committee Finance Office, Shenzhen Regulatory Bureau of the China Banking and Insurance Regulatory Commission, Municipal Administrative Service Data Management Bureau, Municipal Public Security Bureau, People's Bank of China Shenzhen Branch, Shenzhen Securities Regulatory Bureau) IV. Other This opinion shall be implemented from April 1, 2024, with a validity period of 5 years, and shall repeal the "Opinions on Promoting the Development of Supply Chain Finance in Shenzhen" (ShenFuJinFa [2019] No. 7) simultaneously. All relevant units shall actively implement the measures from the date of issuance of this opinion, effectively promoting the high-quality development of financial support for the supply chain in our city. This article is selected from the official website of the "Shenzhen Local Financial Management Bureau", GMTEight Editor: Liu Jiayin.