The Interim Measures for the Administration of Working Capital Loans have been adopted at the 72nd Chairman's Meeting of China Banking Regulatory Commission, and are hereby promulgated and shall come into force as of the date of promulgation.

Chairman: Liu Mingkang

February 12, 21 Chapter I General Provisions

Article 1 In order to standardize the operating behavior of working capital loan business of banking financial institutions, strengthen the prudent management of working capital loans and promote the healthy development of working capital loan business, in accordance with the Banking Supervision Law of the People's Republic of China, the Commercial Bank Law of the People's Republic of China and other relevant laws and regulations.

article 2 the people's Republic of China and banking financial institutions (hereinafter referred to as lenders) established in China with the approval of the China banking regulatory commission shall abide by these measures when operating working capital loans.

article 3 the term "working capital loan" as mentioned in these measures refers to the local and foreign currency loans issued by the lender to enterprises (institutions) as legal persons or other organizations that can be used as borrowers as stipulated by the state for the daily production and operation turnover of borrowers.

Article 4 Lenders shall follow the principles of compliance with laws, prudent operation, equality, voluntariness, fairness and good faith

Article 5 Lenders shall improve the internal control mechanism, implement the whole process management of loans, fully understand customer information, establish a liquidity loan risk management system and an effective post balance mechanism, assign the responsibilities of all aspects of loan management to specific departments and posts, and establish an assessment and accountability mechanism for each post.

article 6 the lender shall reasonably calculate the borrower's working capital demand, carefully determine the borrower's total working capital credit and the specific loan amount, and shall not issue working capital loans beyond the borrower's actual demand.

according to the scale and cycle characteristics of the borrower's production and operation, the lender should reasonably set the business variety and term of the working capital loan, so as to meet the capital demand of the borrower's production and operation and realize effective control over the withdrawal of loan funds.

article 7 the lender shall incorporate the working capital loan into the unified credit management of the borrower and its group customers, and establish a risk limit management system according to the dimensions of region, industry and loan type.

article 8 the lender shall reasonably determine the internal performance appraisal indicators according to the economic operation, the law of industry development and the effective credit demand of the borrower, and shall not set unreasonable loan scale indicators, vicious competition and surprise lending.

article 9 the lender shall agree with the borrower on a clear and legal purpose of the loan.

working capital loans shall not be used for investment in fixed assets, equity, and other fields and uses prohibited by the state.

the working capital loan shall not be misappropriated, and the lender shall inspect and supervise the use of the working capital loan in accordance with the contract.

article 1 China banking regulatory commission shall supervise and manage the working capital loan business in accordance with these measures.

Chapter II Acceptance and Investigation

Article 11 An application for a working capital loan shall meet the following conditions:

(1) The borrower is legally established;

(2) The purpose of the loan is clear and legal;

(3) The production and operation of the borrower are legal and compliant;

(4) The borrower has the ability of going concern and has a legal source of repayment;

(5) The borrower's credit status is good and there is no significant bad credit record;

(6) Other conditions required by the lender.

article 12 the lender shall make requirements on the methods and specific contents of the application materials for working capital loans, and require the borrower to abide by the principle of honesty and trustworthiness and promise that the materials provided are true, complete and effective.

article 13 the lender shall perform due diligence in the form of on-site and off-site, form a written report, and be responsible for the authenticity, completeness and effectiveness of its contents. Due diligence includes but is not limited to the following contents:

(1) The organizational structure, corporate governance, internal control and credit standing of the legal representative and management team of the borrower;

(2) the borrower's business scope, core business, production and operation, business plan and major investment plan during the loan period;

(3) the industry status of the borrower;

(4) the borrower's real financial status such as accounts receivable, accounts payable and inventory;

(5) the borrower's total working capital demand and existing financing liabilities;

(6) related parties and related transactions of the borrower;

(7) the specific purpose of the loan and the counterparty's capital occupation related to the purpose of the loan;

(8) sources of repayment, including cash flow, comprehensive income and other legitimate income generated by production and operation;

(9) for secured working capital loans, it is also necessary to investigate the ownership, value and realization difficulty of the mortgaged property, or the guarantee qualification and ability of the guarantor.

chapter iii risk assessment and approval

article 14 the lender shall establish a sound risk assessment mechanism, implement specific responsible departments and posts, and comprehensively review the risk factors of working capital loans.

article 15 the lender shall establish and improve the internal rating system, adopt scientific and reasonable rating and credit granting methods, evaluate the credit rating of customers, and establish customer credit records.

article 16 the lender shall calculate the working capital demand of the borrower according to its business scale, business characteristics, accounts receivable, inventory, accounts payable, capital cycle and other factors (refer to the annex for the calculation method), comprehensively consider the borrower's cash flow, liabilities, repayment ability, guarantee and other factors, and reasonably determine the loan structure, including the amount, term, interest rate, guarantee and repayment method.

article 17 the lender shall establish a standardized working capital loan evaluation system and process according to the principle of separation of loan evaluation and grading approval, so as to ensure the independence of risk evaluation and credit approval.

the lender shall establish and improve the internal examination and approval authorization and sub-authorization mechanism. The examination and approval personnel shall, within the scope of authorization, examine and approve loans according to the prescribed procedures, and shall not examine and approve loans beyond their authority.

chapter iv contract signing

article 18 a lender shall sign a written loan contract and other relevant agreements with the borrower and other relevant parties, and a guarantee contract shall be signed at the same time if a guarantee is required.

article 19 the lender shall clearly stipulate the amount, term, interest rate, purpose, payment and repayment method of the working capital loan with the borrower in the loan contract.

the payment terms mentioned in the preceding article of article 2 include but are not limited to the following contents:

(1) the payment method of loan funds and the standard of the amount entrusted by the lender;

(2) the change of payment method and the conditions that trigger the change;

(3) restrictions and prohibitions on the payment of loan funds;

(4) Records and materials on the use of loan funds that the borrower should provide in time.

Article 21 The lender shall stipulate in the loan contract that the borrower shall undertake the following matters:

(1) Provide the lender with authentic, complete and effective materials;

(2) Cooperate with the lender in loan payment management, post-loan management and relevant inspection;

(3) obtain the consent of the lender before making foreign investment, substantially increasing debt financing, and making major matters such as merger, division and equity transfer;

(4) the lender has the right to recover the loan in advance according to the withdrawal of the borrower's funds;

(5) notify the lender in time when there are major unfavorable matters affecting the solvency.

Article 22 The lender shall stipulate with the borrower in the loan contract that the borrower shall bear the liabilities for breach of contract and the measures that the lender can take in case of any of the following circumstances:

(1) Failing to use the loan for the agreed purpose;

(2) Failing to pay the loan funds in the agreed way;

(3) failing to comply with the commitments;

(4) breaking the agreed financial indicators;

(5) a major cross-default event occurs;

(6) violating other circumstances stipulated in the loan contract.

chapter v issuance and payment

article 23 the lender shall set up an independent responsible department or post to be responsible for the issuance and payment review of working capital loans.

article 24 before granting loans, the lender shall confirm that the borrower meets the withdrawal conditions agreed in the contract, manage and control the payment of loan funds by means of entrusted payment by the lender or independent payment by the borrower according to the contract, and supervise the use of loan funds according to the agreed purposes.

entrusted payment by the lender means that the lender pays the loan through the borrower's account to the borrower's transaction object that meets the purpose agreed in the contract according to the borrower's withdrawal application and payment entrustment.

the borrower's independent payment means that after the lender pays the loan funds to the borrower's account according to the borrower's withdrawal application, the borrower independently pays the borrower's transaction object that meets the purpose agreed in the contract.

article 25 the lender shall, according to the industry characteristics, business scale, management level, credit status and other factors of the borrower and the variety of loan business, reasonably agree on the payment method of loan funds and the standard of the amount entrusted by the lender.

Article 26 In principle, the method of entrusted payment by the lender shall be adopted for working capital loans under any of the following circumstances:

(1) A new credit business relationship has been established with the borrower and the borrower's credit status is average;

(2) the payment object is clear and the single payment amount is large;

(3) other circumstances identified by the lender.

article 27 if the lender is entrusted to pay, the lender shall, according to the agreed purpose of the loan, check whether the information such as the payment object and the payment amount listed in the payment application provided by the borrower is consistent with the corresponding commercial contract and other supporting materials. After examination and approval, the lender shall pay the loan funds to the borrower's transaction object through the borrower's account.

article 28 if the borrower pays by itself, the lender shall require the borrower to regularly summarize and report the payment of loan funds according to the loan contract, and check whether the loan payment meets the agreed purpose through account analysis, voucher inspection or on-site investigation.

article 29 in the process of loan payment, if the borrower's credit status declines, the profitability of the main business is not strong, and the use of loan funds is abnormal, the lender shall negotiate with the borrower to supplement the loan issuance and payment conditions, or change the loan payment method or stop the loan payment and payment according to the contract.

Chapter VI Post-loan Management

Article 3 The lender shall strengthen the management after the loan funds are issued, analyze the borrower's operation, finance, credit, payment, guarantee and changes in the number and channels through regular and irregular on-site inspections and off-site monitoring according to the borrower's industry and operating characteristics, and master various risk factors that affect the borrower's solvency.

article 31 the lender shall, through the loan contract, require the borrower to designate a special fund withdrawal account and provide timely information on the inflow and outflow of funds in the account.

according to the borrower's credit status and financing situation, the lender can negotiate and sign an account management agreement with the borrower, clearly stipulating the management of the withdrawal of funds from the designated account. ? Lenders should pay attention to the inflow and outflow of large and abnormal funds, and strengthen the monitoring of capital withdrawal accounts.

article 32 the lender shall dynamically pay attention to the major early warning signals such as the borrower's operation, management, finance and capital flow, and timely take effective measures such as early loan collection and additional guarantee to prevent and resolve loan risks according to the contract.

article 33 the lender shall evaluate the matching degree of the loan variety, amount and term with the borrower's operating conditions and repayment ability as the basis for subsequent cooperation with the borrower, and adjust the cooperation strategy and content with the borrower in time when necessary.

article 34 the lender shall, in accordance with the provisions of laws and regulations and the loan contract, participate in the borrower's large-sum financing, asset sale, merger, division, shareholding system reform, bankruptcy liquidation and other activities to safeguard the lender's creditor's rights.

article 35 if a working capital loan needs to be extended, the lender shall examine the reasons for the change of the asset conversion cycle corresponding to the loan and the actual needs, decide whether to extend the loan, reasonably determine the extension period of the loan, and strengthen the follow-up management of the extended loan.

article 36 if the working capital loan is not good, the lender shall conduct special management on it, and make a collection and disposal plan in time. If the borrower fails to repay the loan principal and interest on schedule due to temporary operational difficulties, the lender may negotiate with him for restructuring.

article 37 for truly irrecoverable non-performing loans, the lender shall, after writing off the loans in accordance with relevant regulations, continue to seek recourse from the debtor or conduct market-oriented disposal.

Chapter VII Legal Liabilities

Article 38 Where a lender operates working capital loan business in violation of the provisions of these Measures, the China Banking Regulatory Commission shall order it to make corrections within a time limit. Under any of the following circumstances, the China Banking Regulatory Commission may take the regulatory measures stipulated in Article 37 of the Banking Supervision Law of the People's Republic of China: < P > (1) The business process of working capital loan is defective;

(2) failing to assign the responsibilities of all aspects of loan management to specific departments and posts;

(3) Failing to perform due diligence in loan investigation, risk assessment and post-loan management;

(4) the borrower's breach of the contract should be discovered but not discovered, or effective measures are not taken in time after being discovered.

Article 39 In case of any of the following circumstances, the China Banking Regulatory Commission may, in addition to taking regulatory measures in accordance with Article 38 of these Measures, impose penalties on the lender in accordance with Articles 46 and 48 of the Banking Supervision Law of the People's Republic of China:

(1) granting loans to reduce credit conditions or exceed the actual capital needs of the borrower;

(2) Failing to sign a loan contract according to the provisions of these Measures;

(3) colluding with the borrower to issue loans in violation of regulations;

(4) allowing the borrower to use the working capital loan for fixed assets investment, equity investment and fields and uses prohibited by the state;

(5) approving loans beyond the authority or in disguised form;

(6) Failing to manage and control the payment of loan funds according to the provisions of these Measures;

(7) other circumstances that seriously violate the prudent operation rules stipulated in these measures.

Chapter VIII Supplementary Provisions

Article 4 Lenders shall formulate detailed rules and operating procedures for the management of working capital loans in accordance with these Measures.

article 41 the China banking regulatory commission shall be responsible for the interpretation of these measures. ?

article 42 these measures shall come into force as of the date of promulgation. ?

Appendix: Refer to Appendix 3

Reference for Calculating the Demand for Working Capital Loans

The demand for working capital loans shall be determined based on the difference between the working capital required by the daily production and operation of the borrower and the existing working capital (i.e. the liquidity gap). Generally speaking, the key factors affecting liquidity demand are inventory (raw materials, semi-finished products and finished products), cash, accounts receivable and accounts payable. At the same time, it will also be influenced by important factors such as the borrower's industry, business scale, development stage and negotiation status. According to the borrower's current financial report and business development forecast, the banking financial institutions calculate the demand for working capital loans by the following methods:

1. Estimate the borrower's working capital

The influencing factors of the borrower's working capital mainly include cash, inventory, accounts receivable, accounts payable, advance receipts and prepayments. On the basis of investigation, predict the changes of various capital turnover times and reasonably estimate the borrower's working capital. In actual calculation, the borrower's working capital demand can refer to the following formula:

amount of working capital = sales revenue of last year × (1-sales of last year.