Chinese Banks Use Satellites to Watch Loan Items
Introduction
Many Chinese banks now use satellites to look at things people borrow money for. This helps the banks know if the things are still there and safe. Banks started doing this in 2020. More banks started in 2023. They want to have fewer bad loans.
Main Body
In 2014, China started selling space technology. This made satellite services possible. Zhejiang E-Commerce Bank used satellites first in 2020. Ping An Bank started in 2022. In 2023, China Merchants Bank and Shanghai Pudong Development Bank also used satellites. Then Postal Savings Bank of China worked with Chang Guang Satellite Technology. They made a new satellite together. Banks use satellite pictures to check loan items. These items are farms, buildings, factories, and cars. Banks can see if the items are still there. If a person does not pay back the loan, the bank can take the item. Professor Liang Yan says this helps banks give loans to people in the country and small business owners. These people often do not have good credit records. Chinese banks have problems with bad loans. At the end of last year, 1.5% of all loans were bad. This number was lower before, only 0.9% in 2011. But it was much higher in 2005, at 12.4%. Many big banks still have many bad loans from property loans. The real estate market is not doing well. Satellites help banks check loan items better than old ways.
Conclusion
Chinese banks use satellites to watch loan items. This started in 2020 with a few banks. In 2023, many big banks use it. They do this because many loans are bad and the real estate market is weak.