From global conglomerates to the smallest enterprises, the coronavirus pandemic has spared little to no industry or company from its devastating impacts. That includes companies such as Huayin Health Technology, a medical equipment services firm based in south China's Guangdong Province.

Founded in 2009, the company has witnessed remarkable growth in the independent clinical laboratory (ICL) industry with an annual growth rate of more than 40 percent in 2019. 

But even for an organization that is both one of the country's leaders in private medical testing and heavily involved in the medical industry, financial burdens brought on by COVID-19 have been substantial.

"It was such a medical crisis, it just happened, nobody expected this," said Xiang Xianqing, the company's vice president and chief financial officer.

"It has cost a lot of money, and every year at the beginning of the year, with the Chinese New Year, most companies are already short of capital, so at that moment we were in such a cash shortage situation," added Xiang.

With the sudden shutdown of the Chinese economy in late January coupled with the expected slowdown because of the Spring Festival, Huayin was left cash strapped. 

Facing the predicament of providing medical services during an epidemic, while struggling to secure expensive medical testing equipment, the company stumbled upon what one could call a piece of good news.

"We were really, really lucky at this moment … from a newspaper we learned about a government-established financial services platform for SMEs," explained Xiang, speaking about how he and his team were able to find an avenue for securing much-needed financing.

"Then quite quickly a bank, Pudong Development Bank, approached us [through the platform] and we discussed and exchanged ideas. They became familiarized with our business, and very quickly and efficiently we were approved for a credit line of 37 million yuan."

Earlier in April, Huayin secured Series C round financing of around 600 million yuan – perhaps indicating a promising future for the young company. But this wasn't enough given the additional funding they later sought.

That fresh line of credit can be attributed to an initiative launched by the province's finance authorities. In early January, prior to the virus outbreak, a financing platform specifically for small and medium-sized enterprises (SMEs) was put into place, described as bringing together government data and fintech.

Essentially the government took on the role of helping private enterprises connect with lending institutions, such as banks, to facilitate quicker valuations and financing. A lot of platforms make use of online matchmaking, described as intelligent financing.

"Traditionally, SMEs had to submit many documents to secure financing from a bank, and perhaps they didn't know the process," said He Xiaojun, director-general of the Guangdong Financial Supervision Authority.

"They were in need of an intermediary, but that raised the cost of applying for a loan. But with our mechanism and platform, we use what we call intelligent matchmaking. It allows companies and banks to directly connect. It reduces the burdens faced by SMEs and mitigates their potential lack of knowledge surrounding banking."

According to the government's projections, more than 300,000 enterprises are expected to be served through the platform by the end of this year. By the end of 2022, that number is anticipated to reach one million. As for financial institutions involved, 100 banks are offering their products and services.

Despite the fortunate timing of the initiative, there are plausible concerns about the financing platforms heavily reliant on companies disclosing their finances on such a large scale. 

Moreover, according to an April 2020 report by the Cambridge Centre for Alternative Finance, over the past four years, regulators have imposed stricter guidelines on peer-to-peer financing schemes, potentially reducing alternatives and thus streamlining options for SMEs more toward banks and government-backed institutions.

However, for He, there's no reason for panic as the platform isn't meant to replace any other options.

"No, I don't think so. I think it's all about efficiency. The goal is to increase the business credit of SMEs through big data platforms. A good business environment is fueled by a strong enterprise environment." 

"If we keep our promise, through credit, through honest business, then SMEs can secure loans and financing at lower costs. Our goal is to cultivate a better commercial credit system in Guangdong," he explained.

With China's economy continuing its restart, the need for quick and accessible funding for SMEs will undoubtedly play a pivotal role in the second half of the year.

For Huayin, acquiring additional funds has paid off as the company is back in operation, being able to provide services to hospitals and other clients. Looking back at his newspaper discovery, Xiang said the initiative is surely worth applauding.

"I think without the government getting involved, the discussion and the valuation would have taken much, much longer."

(Zeng Wenxiang also contributed to this story.)