(Yicai Global) Nov. 29 -- Shanghai officially launched a CNY100 billion (USD14.2 billion) loan program today to help support science and technology innovation startups that seek to list on the city's new Nasdaq-style Star Market.
The first batch of 12 businesses signed contracts with 12 commercial banks, securing total credit of CNY4.47 billion. The funds will be used to boost investment in research and development, market expansion, talent acquisition and training as well as promote the application of innovative products.
A collaboration between local economic and financial authorities, banks and the Shanghai Administration Center of Policy Financing Guarantee Funds for SMEs, the program targets some 230 companies on the local government-recognized Star Market Listing Plan. Participating banks will provide various interest rate discounts based on the marketization of interest rates.
"This program will save our company about CNY80 million (USD11.4 million) in total, which will not only greatly improve our financial statements, but also finance our investment in R&D," Shanghai Pateo Chairman Ken Ying, one of the first corporate recipients, told Yicai Global. It has become a Star Market backup company and plans to submit listing documents next June, Ying added.
The Star Market, which opened in July, aims to make it easier for Chinese sci-tech companies to raise funds. So far 56 companies have listed on the board.
Under the new loan program, banks will set up green channels to review firms applying for the loans. Reviews should not take longer than 20 working days in principle.
Editor: Tang Shihua