Editorial | Pledge for fairer and quicker Hong Kong loan access a needed shot in the arm
- Move is an essential platform for sustainable recovery by small and medium-sized businesses from economic pressures beyond their control
Small businesses and home mortgage borrowers are most exposed when high interest rates and falling asset prices combine to exert pressure on cash flow. Timely access to financial relief can make a difference to survival.
Within the bounds of prudence, they need lenders to expedite eligible applications for accommodation and reflect temporary business conditions in their loan assessments. It is therefore good news that 11 of Hong Kong’s banks have pledged to provide fair and quicker access to loans, as they heed the call by the city’s de facto central bank to cut red tape and provide funding help.
Small and medium-sized business is the life blood of the grass-roots economy and the backbone of employment. The city remains in extended recovery mode from the pandemic slowdown.
The highest interest rates for nearly two decades have weighed on fragile confidence when consumers and business alike both needed the reassurance of stability and certainty.
Hanging on for interest rates to come down has not proved a viable strategy for many borrowers. It has taken longer than expected for higher rates to satisfy economic policymakers that they have tamed inflation.
