Beijing-based China Construction Bank is planning to set up as many as 100 financial units, in association with Spain’ Banco Santander, to offer banking services in China’ rural areas, reported Bloomberg.
According to the Central Bank’ estimates, approximately 65% of the 700 million people in rural areas are deprived of access to banking services. As a result, global lenders are entering into China in a big way.
Li Qing, a Shanghai-based analyst at CSC Securities, said: “China has a huge untapped rural market, which lacks basic banking services. Banks may not make a profit out of it immediately, but eventually those who preempt the market will be rewarded as government policies are geared to improving the rural sector.”
Chinese government is also taking steps to boost income among the farming community. It is aiming to double their earnings over the next decade by increasing public works spending and by promoting rural loans.
