A friend of mine is desperate. He has been talking in vain with every bank in Shanghai attempting to get a loan to buy a car. It's an unusual case covered by the special policy for returned students from overseas. He will buy a car from the car manufacturer in Hubei Province rather than from a local dealer.

Not a single bank wants to take the risk without the presence of a local dealer. Nor do they want to accept the car as a mortgage. Even his yearly salary package of 150,000 yuan means nothing to the banks.

"We want fixed assets as collateral for loans," was the unanimous reply from banks. But my friend is fresh back from Germany and has not been able to buy a house yet. He said he has been hoping for a loan from a Chinese bank. After all, the banks claim to provide various loan services.

In fact, this is one of the reasons for his decision to return to China. The 30-something said credit consumption would make life easier but the banks instead have made his life more difficult. He and his wife have spent one month consulting the so-called convenient banks. He's had no positive news and it is almost driving him crazy as the expiration of the time allowed for him to buy a tax-free car is approaching.

He wants to know why "these banks would rather give money away to near-bankrupt State-owned enterprises?" He is not alone - many Chinese consumers are asking the same question. College students have complained that it is almost impossible to get financial support from local banks. Nevertheless, banks have been promoting this service as one of their activities.

On the other hand, millions of dollars have been reported to have been lent to profit-losing enterprises with no prospect of the loans being paid back. The only thing the banks can do is to peel off these so-called non-performing assets.

Banking people say that it is an individual's credit rating that worries them most. They said that cases of not paying back personal loans are not rare. Granted that individuals may default, the amount in no way matches that of SOEs.

Meanwhile, personal credit is not necessarily worse than that of enterprises. For whom does the bank operate? If they are really business oriented, I guess it would be a better option to lend money to individuals.

A complete system of personal credit is necessary before much longer.

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