China's first consumer finance company has delivered its inaugural loan in Beijing. The new service, pioneered by Bank of Beijing, will deliver a boost for young, cash-strapped people in need of small loans.

Zhang Hongqi, 36, was able to buy his new mobile phone after securing a personal loan from the Bank of Beijing. He will repay the loan over the next 12 months.

People over 20 years old with steady employment can apply for loans, regardless of their income. Bank of Beijing tailors its consumer finance to help clients subsidize personal costs from travel plans to home decoration.

"I did not expect I could buy such an expensive mobile phone," said Zhang. "I did not have enough money up front. But now, I can make such a purchase without using my cash."

Though fully-developed in western countries for years, personal finance is relatively new to Chinese banks and consumers.

To minimize risks, Bank of Beijing adjusts its interest rates to meet customers' financial circumstances. A client can borrow a maximum of up to five-times their monthly income.

The bank is upbeat that the new form of finance will be well received in China.

(CCTV.com March 2, 2010)