In China, the healthy growth of e-commerce and fast adoption of Internet Banking enable banks to use another option to extend credit in recent years - online loans are getting popular for small/micro enterprises to apply, borrow and repay online. Online loans are "weapons" for small/micro enterprises to obtain bank loans as they are fast, convenient and saving cost. Take ICBC as an example. The Bank has provided online loans to 32,000 small enterprises since the launch of the service at end of 2009. In 2011, ICBC has disbursed more than RMB 300 billion in online loans to small and micro enterprises. At the end of 2011, ICBC's outstanding online loans to small and micro business owners reached nearly RMB 180 billion, a jump of 101%, or RMB 90.6 billion from the beginning of the year.

So far, ICBC's online loans to small and micro business owners are mainly in two large categories: "Online Loan Link" extending credit online, and e-commerce "Easy Finance Link". "Online Loan Link" is a service for small and micro enterprises to access revolving loan online by themselves. They can apply, draw or repay loans online without going to the Bank. "Anytime, anywhere" - the borrowers can apply and repay without restriction. "Online Loan Link" is very suitable for small enterprises to obtain financing "in a short time, in a frequent and quick fashion". Small business customers warmly welcome this new service.

Meanwhile, "Online Loan Link" is also highly efficient, can be applied at your own wish, no drawdown, no interest calculated. Borrowers can borrow or repay loans depending on their peak/weak seasons, which means large savings in borrowing cost and better catering their intermittent and periodic demand of funds. Take the current benchmark interest rate of 1-year loan, if a loan of RMB 1 million can save 60 days of service period in a year, nearly RMB 11,000 of borrowing cost can be saved. To a small enterprise, this is not a small sum of money.

Mr. Chen Bo, Chairman of Zhejiang Baofa Aquatic Products Co., Ltd., is very impressed by the convenience of online loans brought to small and micro business owners. Chen Bo's company is a small enterprise in Zhejiang Zhoushan's Daishan County primarily engaged in the procurement, processing and sales of aquatic products. Since the company is located on an island, Mr. Chen has to take a ferry every time if he wants to go to the bank in Zhoushan city. It usually takes half a day for him to go and get back. To address this issue, ICBC in Zhoushan recommended "Online Loan Link" to Mr. Chen. Mr. Chen then signed a two-year revolving loan contract with ICBC to borrow RMB 3.05 million. Chen Bo said, after signing the "Online Loan Link" agreement, he simply applies for loan via Internet Banking whenever there is a need of working capital, easy procedures, fast, no more hassle running to the bank to get a loan in a timely fashion. Loan can be drawn via Internet Banking even when he is outside Zhoushan, just as convenient as using a credit card. Moreover, "Online Loan Link" allows borrowers to reasonably allocate company funds according to peak/low seasons, draw loan when in need of money during peak season and use idle money to immediately repay during low season.

Besides the "Online Loan Link", in line with the financial needs emerged during the development of e-commerce, ICBC also launched "Easy Finance Link - loans to online micro enterprises", a new type of online finance product designed for small/micro enterprises, micro enterprises and individual industrial and commercial households running business on the third-party e-commerce platforms. Small online loans under RMB 5 million are offered to each borrower. The micro online merchants, as long as they have normal business and good credibility, are welcomed to apply for loans via ICBC web portal, Internet Banking or third-party e-commerce partners by themselves. ICBC system will automatically process the information submitted. The background processing will automatically determine the credit line and loan interest rate based on the application details submitted by customers. All processings are standardized. "Easy Finance Link" enables borrowers to sign loan contracts online, the first such service in the banking sector. Besides, all procedures starting from loan application to review and approval, contract signing, loan withdrawal and repayment can be completed online, simpler and easier. Extending loans online becomes automatic and very convenient. In online finance solutions, ICBC was the first to launch e-supply chain finance and online merchandise mart finance service. ICBC works with e-commerce partners to serve small and micro enterprises.

An executive with ICBC said, this year ICBC will step up its innovation on online finance solutions. In line with the fast development of e-commerce, more innovative products will be designed to serve the transactions between companies so that online finance products are embedded in the transaction flow, serving the real business needs of small and micro enterprises. Among these, ICBC will focus on extending micro business loans under RMB 5 million, offering easier access for small/micro enterprises of smaller scale to get online loans.