HKMA study finds Commercial Data Interchange improves SME loan terms
A new research memorandum from the Hong Kong Monetary Authority (HKMA) finds that banks actively using Commercial Data Interchange (CDI) offer more favorable loan terms to small and medium-sized enterprises (SMEs). The study, published on January 21, 2026, shows lower interest rates and fewer collateral requirements for SME loans.
Lower rates, fewer collaterals
The study empirically examines the effects of CDI on SME loan terms, analyzing a large sample of new SME loans between January 2022 and March 2025. Results indicate that banks more actively using CDI, on average, charge lower interest rates by 36 basis points and require 1.1 fewer units of collateral compared to other banks after CDI's launch.
These effects are economically significant, translating to approximately a 6 percent reduction in average interest rates and a 22 percent reduction in collateral requirements within the sample.
The research highlights CDI's potential to address data limitations that typically lead to higher financing costs for SMEs.
Targeting data gaps
The Commercial Data Interchange (CDI), launched by the HKMA in October 2022, is a consent-based platform enabling firms to share financial and other information with banks.
This initiative aims to overcome the lack of sufficient and timely financial data, a key barrier hindering banks' ability to accurately assess SME creditworthiness.
The study finds CDI's positive effects are more pronounced for young firms, which often face greater data-related difficulties in obtaining bank credit, and for borrowers from sectors more easily able to use CDI, such as retail, wholesale, and import/export.
Promising, but with caveats
The study offers promising empirical evidence that data sharing platforms can genuinely improve SME access to finance.
However, its acknowledged data limitations, particularly the reliance on a subset of loans and bank-level comparisons, necessitate caution in interpreting the quantitative estimates.
Wider adoption of CDI remains crucial for realizing its full potential in Hong Kong's SME lending landscape.