As China progressively introduces policies favouring a competitive financial system, more and more commercial banks supported by private and foreign capital have joined the five largest stated-owned banks in the market.

When it comes to choosing a bank, some people say sometimes, big means too big. Xia Weiqiao, a customer, said, "We would like to visit big banks. The brand is important to us."

Xia Guoxiu, a customer, said, "Although we prefer big banks because our money seems safer there, sometimes the lines are too long there."

Peng Yuping, a customer, said, "Big banks charge fees for many kinds of services."

Take money transfer charges as an example. In April, China's bank regulator ordered banks to publish all charges before they collect fees, and suggested the banks discontinue as many fees as possible. But there are no charges listed on Industrial and Commercial Bank of China (ICBC) website. And nothing on China Construction Bank's, either. Only about 100 of the 1000 different kinds of fees have been cancelled. And all five are still charging fees for the most commonly used inter-bank transfer service.

"Our bank charges two yuan for an overnight money transfer. For those who need an instant transfer, we charge 0.5% of the total amount."

"The rate is 1% of the total transfer amount, with a maximum of 50 yuan ($7.9) and a minimum of 1 yuan ($0.16)."

But some smaller banks are trimming their charges. "Now we don't charge extra fees when clients transfer money."

The China Banking Regulatory Commission's latest report shows the market share of small banks and foreign banks in China has increased from less than 20% to more than 40% since China joined the World Trade Organization in 2001.

But the five major state-owned commercial banks - Industrial and Commercial Bank of China, Bank of China, China Construction Bank, Agricultural Bank of China and Bank of Communications -still dominate the market. The annual financial reports of the big five in 2011 indicate the net profit for these banks was more than 1.8 billion yuan ($280 million) a day last year, with ICBC making the greatest gains.

And the big five also top all the listed companies. Experts said that's mainly due to the big five's dominance of the market and to government policies that protect their expansion. So the only way for small banks to earn a bigger market share is to focus more on providing professional service in specific areas.

Gao Jie, lecturer of Shanghai University, said, "Rather than providing full services, the medium and small-sized banks should offer personalized services to meet clients' needs on investments. For example, they can offer financial products with superior returns, or specialize in certain kinds of industries. They can also float the interbank offered rate, and even accelerate the financial liquidity."

In this year's Central Government work report, China's Premier Wen Jiabao said the country's financial institutions should do more to help small and medium-sized businesses develop. And a city official said it benefits both those businesses and smaller banks in Shanghai.

Fang Xinghai, director of Shanghai Financial Services Office, said, "We encourage them to do more businesses with small and medium-sized companies, to specialize in certain areas so that they will have market strength in those special areas, rather than doing all kinds of business and trying to compete with the big five."

After widespread criticism that China's state-run banks enjoy special treatment that ensures a fat interest margin, China's Central Government has said several times this year that it will break up the big banks' monopoly. And with more policies that encourage an open financial market in Shanghai, the lack of competition in the banking sector is expected to change, to help build the city into an international financial center.

(CNTV.cn May 9, 2012)