This is interesting: HSBC is setting up a village bank. And it’s not just HSBC, either. Apparently the CBRC is trying to encourage all banks to expand into rural areas:
On Monday, the China Banking Regulatory Commission (CBRC) vowed to help more banking institutions to extend service in the rural areas as a way to upgrade the country’s under-developed rural banking sector. At the end of 2006, the CBRC scrapped working capital limits for domestic financial institutions in rural areas so that banking networks could be developed in the countryside.
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It also lowered the registered capital threshold to 3 million yuan (US$385,000) for banks in counties and 1 million yuan in villages and towns.
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The CBRC has approved six pilot schemes in six provinces including Qinghai and Gansu. Two of them — Huimin village bank and Huimin finance company — began operations last Thursday in Yilong county of southwest China’s Sichuan Province.
All I can say is I hope this is good news.
