Digital Banking Support to Small Businesses amid COVID-19: Evidence from China

June 29, 2021

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Format: Chicago

Tao Sun. Digital Banking Support to Small Businesses amid COVID-19: Evidence from China, (USA: International Monetary Fund, 2021) accessed December 26, 2024

Summary

This note analyzes the economic impact of digital lending to micro and small sized enterprises (MSEs) in China during the coronavirus disease (COVID-19) pandemic. A preliminary analysis of a large pool of MSEs served by a digital bank indicates that digital banks were able to remotely evaluate borrowers and sustain lending during the pandemic, thereby facilitating the business continuity, sales growth, and financial inclusiveness of MSEs. In the global context, a policy framework—leveraging the advantages of digital banks and empowering digital banks, while guarding against possible financial stability risks—would further support small businesses during and after the COVID-19 pandemic.

Subject: Corporate finance, COVID-19, Economic sectors, Financial crises, Financial institutions, Health, Loans, Small and medium enterprises

Keywords: Borrowing decision, Corporate finance, COVID-19, Credit demand, Digital bank, Digital banking, Fintech, Global, Lending to micro, Loans, Micro and small enterprises, Small and medium enterprises, Technology firm

Publication Details

Pages:

16
Volume:

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DOI:

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Issue:

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Series:

Global Financial Stability Notes No 2021/002
Stock No:

GSNEA2021002
ISBN:

9781513585192
ISSN:

2791-3112

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