China’s Alibaba Establishes Small Loan Company
Chinese B2B e-commerce group Alibaba has established a small loan company in Zhejiang to provide loans below CNY500,000 to its sourcing and procurement clients in Zhejiang.
Zhao Jingpeng, a representative from Taobao.com, the Internet shopping subsidiary of Alibaba, told local media that the opening of the e-commerce platform has brought numerous opportunities to Chinese entrepreneurs and small- and medium-sized enterprises. Statistics show that to date, Taobao.com claims to have created over one million direct jobs in China.
However, these entrepreneurs and SMEs always face financial problems, although what they often need is just a small amount of working capital. The newly established small loan company aims to serve the grassroot user group and provide loans of below CNY500,000 to them to meet their financing demands for operation expansion and to support the development of these entrepreneurs and SMEs.
At present, this service is only opened to online shop entrepreneurs and SMEs in Zhejiang province.
Alibaba Group has been exploring ways to provide financial services to SMEs in China. Early in June 2007, the group teamed with China Construction Bank and Industrial and Commercial Bank of China to provide loads to SMEs. Companies participate in this project do not need to provide any mortgage and they only need to form a small alliance with three or more companies to apply for the loans. Over the past three years, Alibaba and the two banks have jointly provided CNY12.8 billion loans to SMEs.