Citigroup intends to expand from the big
cities to the provinces by setting up 10 rural banks and loan companies
in China's rural areas, according to a state media report citing Zang
Jingfan, Director of Cooperative Finance at the China Banking
Regulatory Commission.
Citigroup plans to join China's pilot
programme that will allow foreign financial institution investors to
operate in six of the nation's western and central provinces - part of
the Chinese government's plan to funnel investment inland from the
affluent east coast belt.
An estimated 800 million people in
China, mostly low-income farmers, live in the western and central
provinces, and currently have only limited access to financial
institutions and products. China Daily reports that the Chinese
government this month expanded the pilot programme to 31 provinces to
boost competition - and the availability of banking products and
services.
Other foreign banks are looking to tap into the
potentially vast but uncertain rural market: HSBC, the largest foreign
bank in China, is one - it received approval in August to set up a
rural bank in Suizhou, in central China's Hubei Province. However,
foreign financial companies can only set up rural banks and loan companies, but not credit cooperatives.
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