China strengthens oversight of consumer finance firms.

• The National Financial Regulatory Administration announced measures that will take effect on April 18.
• The new rules require firms providing consumer loans, except for those for home and car purchases, to have a minimum registered capital of 1 billion yuan ($139 million).
• The financial sector is facing increased regulation from Beijing.

The Chinese government has increased the capital requirements for non-bank financial institutions that offer small personal loans.

The National Financial Regulatory Administration announced measures that will take effect on April 18.

The financial sector is facing increased regulation from Beijing.

According to Reuters, the new rules for providing consumer loans have increased the minimum registered capital requirement for eligible firms, excluding those for home and car purchases, to 1 billion yuan ($139 million) from the previous 333 million yuan ($49 million) under 2014 rules.

According to the statement, investors of consumer finance firms are classified as either main investors or general investors. To be classified as a main investor, one must hold a stake of at least 50%.

The regulator stated that financial institutions that are major investors must have a minimum total asset value of 500 billion yuan ($69.45 billion) or an equivalent amount in freely convertible currency by the end of the most recent fiscal year.

According to the NFRA, major investors that are non-financial institutions must have an annual operating income of at least 60 billion yuan ($8.3 billion) in the most recent fiscal year.

In recent years, China has made efforts to curb the rapid expansion of non-bank debt, particularly those issued by shadow banks that operate outside the formal banking system.

The creditworthiness of the Asia-Pacific region has been affected by the slowing growth of the country.

Moody's revised its assessment of China's government credit ratings from stable to negative in early December, stating that Beijing's financial support measures could weaken its fiscal, economic, and institutional strength.

At its "Two Sessions" meeting, China set a GDP growth target of "around 5%" for 2024 and announced the issuance of "ultra-long" special bonds for major projects.

— CNBC's Evelyn Cheng and Clement Tan contributed to this story.