Channel Financial Resources to Benefit Small Businesses: SSE Continues to Serve the Financing of MSMEs

Yang Yiren, Xinhua Finance

Recently, Wenzhou Industry & Energy Development Group Co., Ltd. successfully issued 50 million yuan of support bonds for micro, small, and medium-sized enterprises (MSMEs) on Shanghai Stock Exchange (SSE), which attracted the attention of the industry. Up to now, 14 support bonds for MSMEs have been issued on the SSE, totaling 3.6 billion yuan, supporting more than 500 small and medium-sized enterprises (SMEs) as well as private enterprises.

MSMEs run into financing difficulties due to their limited scale and anti-risk capability, despite being the linchpin of economic and social development. In October 2023, the SSE creatively launched support bonds for MSMEs and amended rules in December 2024 to enhance flexibility in the use of funds.

The funds raised by Wenzhou Industry & Energy Development Group through the bond issuance are intended to facilitate exchange of equity in MSMEs running wind power home port business in the region. The aim is to promote wind power development in southern Zhejiang. This is also a manifestation of local efforts to promote the "high-quality development of the private economy".

The SSE facilitates bond issuance by enterprises with good credibility and close business ties with MSMEs, which raise funds for the purpose of making advance payments to MSMEs. For example, Capitech issued support bonds for scientific and technological innovation-driven MSMEs, with funds invested in sci-tech and innovative MSMEs in Xi'an High-tech Industries Development Zone. Dongying Financial Investment Group issued support bonds for Belt and Road (BRI) MSMEs to support the business in countries of the BRI initiative and upstream MSMEs. TBEA Co., Ltd. issued bonds to support upstream and downstream MSMEs along the industrial chain.

In addition, the SSE continues to break new grounds on asset-backed securitization to revitalize idle assets. In 2024, 112.5 billion yuan of supply chain ABS products were issued to support the development of upstream SMEs and private enterprises. ABS products are highly effective in serving small and micro enterprises and are able to benefit thousands of such enterprises. These products focus on "high-end, specialized, and innovative enterprises" and aim to promote the upgrading of industrial chains. Vivid examples include special plans such as the "Yuanhui Series", "Hangzhou Future Sci-Tech City", "JD Science and Technology".

According to a senior researcher in bond market, the SSE has been connecting MSMEs with financing resources and improving the efficiency of capital markets in serving inclusive finance through policy innovation and market practice. Looking into the future, the SSE will give full play to market functions, optimize rules, precisely meet the needs of enterprises, grow investors, and enhance the liquidity of secondary markets, aiming to inject new impetus into the development of MSMEs and serve the high-quality development of the real economy.

The above information is provided for reference purposes only and does not constitute investment advice.