China has introduced stricter rules for consumer finance firms for the first time in a decade, raising the requirements for non-bank financial institutions offering small personal loans in the country, Reuters reported on Tuesday.
The new regulations, effective from April 18, aim to enhance oversight in the financial sector amidst a post-COVID economic recovery, according to the report.
The revised rules, issued by the National Financial Regulatory Administration (NFRA) after a consultation period, include higher minimum capital requirements and ownership thresholds for firms providing consumer financing.
Key changes include a minimum registered capital of one billion yuan ($139 million) and a 50 per cent stake requirement for major investors.
Major investors in financial institutions must now have total assets of at least 500 billion yuan, up from 60 billion yuan. Non-financial major investors must have at least 60 billion yuan in operating income, double the previous threshold.
