China’s IP-Backed Financing Landscape (WIPO Report)

The WIPO report “Unlocking IP-backed Financing: China’s Journey” outlines how China has progressively developed a broad framework for financing based on intellectual property. Over more than two decades, the country has expanded its financing mechanisms to include IP pledge lending, insurance, and securitization, with a growing emphasis on enabling SMEs and innovation-driven enterprises to access credit through intangible assets.

By 2022, IP-backed lending in China had reached CNY 486.9 billion, which translates to approximately USD 67.2 billion. This figure grew further in the first three quarters of 2023, reaching CNY 495 billion (roughly USD 68.3 billion), marking a significant 52.9 percent year-on-year increase. More than 18,000 micro, small, and medium-sized enterprises (MSMEs) benefitted from this financing, with a majority receiving loans below CNY 10 million (≈ USD 1.38 million). This underlines the inclusive nature of China’s IP finance efforts, focusing especially on businesses that typically lack access to traditional forms of secured lending.

Alongside lending, IP insurance has become a critical component of the ecosystem. As of September 2023, the People’s Insurance Company of China (PICC) provided risk coverage totaling over CNY 130 billion across 99 cities for IP assets held by around 31,000 businesses — offering protection for patents, trademarks, and geographical indications.

China has also become active in IP securitization. By late 2023, 119 IP-backed financial products had been issued on the Shanghai and Shenzhen stock exchanges, raising CNY 26.8 billion (approximately USD 3.7 billion) in financing through assets like license fee receivables and pledge-backed cash flows.

From a corporate perspective, the integration of IP into financial reporting has also advanced. As of 2021, 94.6 percent of A-share listed companies disclosed IP assets in their financial statements, with reported IP assets totaling CNY 964.2 billion, representing 15.7 percent of all intangible assets disclosed. This reflects a growing institutional acceptance of IP as a material business asset.

In summary, the WIPO report presents China not as a unique case, but as a reference point for other countries seeking to integrate IP into financial infrastructure. Through coordinated legal reform, public-private collaboration, and capacity building around IP valuation, China’s experience offers practical insights for policymakers, lenders, and investors worldwide.