Four departments, including the China Banking and Insurance Regulatory Commission ("CBIRC"), have recently issued the Circular on Further Standardizing and Improving the Administration of Small-amount Loans Offered for Poverty Alleviation (the "Circular").
The Circular outlines specific measures to maintain the sound development of small-amount loans offered for poverty alleviation purposes, from five perspectives of adhering to and improving policies on small-amount loans for poverty alleviation, effectively meeting the capital demands of the registered impoverished households, properly dealing with loan renewals and loan extensions, getting well prepared for the peak period of repayments, optimizing the risk compensation mechanism, dealing with the small-amount loans for poverty alleviation that are not directly used to enhance the production of poor households by category and reinforcing organizational guarantee. Major contents of the Circular include: 1. setting out clear general requirements for development of small-amount loans offered for poverty alleviation; 2. reaffirming the key points of policies on small-amount loans for poverty alleviation; 3. emphasizing the uses of small-amount loans for poverty alleviation; 4. proposing policy-level measures to fend off and resolve risks; and 5. Clarifying the division of responsibilities among related authorities. Among others, the Circular notes that targets to whom small-amount loans for poverty alleviation will be granted should include the registered poor households that have been out of poverty, adding that the age requirement for borrowers may be relaxed to the 65-year-old limit.