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At Extreme Investor Network, we pride ourselves on providing valuable and unique insights into the world of cryptocurrency, blockchain, and all things related to the digital asset space. Today, we are excited to bring you the latest news from the Hong Kong Monetary Authority (HKMA) and the Hong Kong Association of Banks (HKAB) regarding their joint Taskforce on SME Lending.
The joint Taskforce on SME Lending, established by the HKMA and HKAB, recently held its inaugural meeting on September 5, 2024. The focus of this meeting was to address the challenges faced by Small and Medium Enterprises (SMEs) in obtaining and maintaining bank financing, a crucial issue in the current economic landscape.
Key Discussions and Initiatives
Chaired by Mr. Arthur Yuen, Deputy Chief Executive of the HKMA, and Ms. Luanne Lim, Chairperson of the HKAB, the meeting brought together key representatives from both organizations and 14 banks actively involved in SME lending. The discussions covered various essential topics, including:
- SME Support Measures: Banks reaffirmed their commitment to existing SME support measures, ensuring continuous financing and support for sustainable SME development.
- Risk Appetite: Banks confirmed their risk appetite and credit approval standards towards SME financing remain unchanged.
- Customer Fairness and Transparency: The Taskforce highlighted issues such as unclear bank information and lengthy credit approval processes. Best practices were shared to enhance transparency and streamline application processes for a better customer experience.
- Manpower and Resources: Banks pledged to allocate sufficient resources to review credit approval requests promptly, aiming to respond within one month under normal circumstances.
- Future Initiatives: Discussions also revolved around promoting bank support for SME development, upgrades, and transformation through seminars and activities to enhance productivity using data and technology.
Commitment to Risk Management
The Taskforce emphasized the importance of effective risk management to protect depositor interests. For cases of prolonged non-repayment despite relief measures, banks will take appropriate actions while maintaining clear communication with affected customers.
Future Outlook
With the establishment of the Taskforce in August, the aim is to provide comprehensive support for SMEs at both individual and industry levels. A mechanism for reviewing cases of SMEs facing financing difficulties has been put in place, with the HKMA referring cases to relevant banks. Further initiatives will be announced to enhance communication and support for SME financing needs within the commercial sector.
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