Growing Success with Micro Credit

With the help of government-subsidized micro loans and her innovative patent, Zhang Guiyun from the outskirts of Harbin founded a business in the city.

Zhang Guiyun, 53, was once a common housewife in rural Yanglin County on the outskirts of Harbin, Heilongjiang Province. In 2000, she moved into the city to chase after her dream of starting her own garment shop.

Zhang applied for and received a patent in 2005 for a feather coat that allows separation of the feathers and the coat exterior for easy cleaning. She established a factory to produce these coats, especially for middle aged women.

"I never worry about the sales, since winter in Northeast China is so cold," she said.

She dreamed about expanding her shop and factory, but her limited cash flow does not leave her room to grow.

A local women's federation came to her aid. Zhang was informed that she qualified for government-subsidized micro credits for the development of women in small businesses.

It took less than a month for Harbin Bank to grant Zhang a loan of 100,000 yuan (US$15,920) for one year last August.

Yang Cui, a credit clerk from Lida branch of Harbin Bank, is in charge of many clients with similar situations.

"Many small business owners especially in trading and circulation industries have strong desire for loans. But usually banks prefer bigger clients and few of them could qualify," she explained.

"We have developed a credit valuing system for small business to replace mere estimations based on accounting reports, since many of our clients don't have regular reports."

Zhang was pleased to be a beneficiary. "I already bought equipments and rent another 200,000 yuan (US$31,840) booth. My sales goal is 500,000 yuan (US$79,600) this year," Zhang said with a smile.

"I know it's still not a big number compared with big brands. But for me, it is the first step to allow me dream to reach even higher," she said.