From Overseas Press

Women entrepreneurs in China get helping hand

(chinadaily.com.cn)
Updated: 2010-09-28 13:30

A government-backed microfinancing program has helped "thousands of laid-off women get back on their feet." Meanwhile, many business incubator programs in different provinces have trained female entrepreneurs to start their own businesses, said an AFP article on Sep 26.

Zhao Weimin, a Tianjin resident who lost her job five years ago, decided to start a business with her husband, "whose own employer had gone bankrupt." "Lacking money and experience, they sought the help of the Tianjin Women's Business Incubator."

Their idea was "given the thumbs-up, and the couple received training in how to run a business and an interest-free loan of 4,000 yuan (600 dollars) to lease shop space in Tianjin." Later, they "borrowed another 20,000 yuan to buy equipment" to start the business.

The Chinese government restructured many loss-incurring state-owned enterprises in recent years, resulting in massive layoffs across the country, many of them women in their 40s and 50s. When they struggled to find new employment, they found help from the business incubator program that was launched in 2000.

Other loan recipients include Jin Lan, 54, who borrowed 50,000 yuan to start a business. She said, "There's less pressure to repay the loan, and the conditions are more relaxed than at the bank. If I can't meet my monthly payments, one of the other women in the group will help me."

In many cases, "state-owned commercial banks are not prepared to lend money to entrepreneurs because the size of the loan is too small or they have no assets to offer as collateral." But the microfinancing program has helped them.

Patrick Chovanec, an economics professor at Tsinghua University in Beijing, said that China's microfinancing "potentially plays a very important role because it is filling a gap that the formal banking system doesn't fill."