Thursday marks the one-year anniversary for Wenzhou to be China's first pilot city of financial services reform approved by the State Council. In the past year, Wenzhou took several steps to regulate private lending and create new channels for private investment as well as financing for small and medium-sized businesses.

On the anniversary of Wenzhou's financial reform, rather than celebration, it's more about innovation. A couple of new financial services companies are about to open. All related to offering cash to small and medium-sized businesses.

Zhang Zhenyu, director of Wenzhou Government Financial Bureau, said, "The new financial instrument agencies, emergency lending companies and reassurance firms will help companies get funding. This year, more companies of this kind will open, to cover all counties in Wenzhou."

One year ago, Wenzhou's shadow banking activities have triggered much criticism. The most pressing task for the financial reform was to regulate private lending. Last April Wenzhou opened China's first private lending registration center. For those in need of cash for their business or those who have money to invest, the center is a match maker. Every deal is kept on record, for the sake of credibility.

From early this year, Wenzhou publishes the average interest rate of private lending every day. This has become an indicator for private borrowers and lenders.

Zhang Zhenyu said, "The interest rate is generated by the free market. When the market rate returns to a reasonable level in the future, it will gradually influence the bank interest rate. This is the early stage of the marketization of the interest rate."

Although the private lending registration center is a safer choice, so far, the value of successful deals is below 600 million yuan, far less than the estimated billions yuan of shadow lending. But Zhang Zhenyu is not too worried.

Zhang Zhenyu said, "We don't expect to get all shadow lending money to our registration center, but we want to orient the market rate for private lending activities."

Zhang Zhenyu said, "Efforts have been made to reform Wenzhou's financial services industry, by exploring new ways of investment for private capital, creating more channels of financing for private businesses and regulating the financial market. But many say the process is much slower than expected."

For the future, government officials are optimistic that the interest rate will be further liberalized and thereby lower the financing costs.