Sunday, February 21, 2010

China Tightens Bank Lending Rules

This article goes along the lecture we had on Asian economies. The main point of this article is credit control, i.e. decrease in risk through a careful screening process of the borrowers. This applies to both working and personal loans - borrowers will have to specify what they will use the loan for. All these regulations were put in place to avoid inflation and to strengthen control over lending.

1 comment:

Mishaal said...

This is sensible on China's part. Instead of giving all firms finance, regulation will help the economy as there will be fewer chances of default in proper screening is carried out.