According to Caixin, Chinese authorities are growing cautious toward structured notes backed by nonbank debts and receivables. More companies in China have in recent years packaged their receivables and loans in what the regulators here called “corporate” asset-backed securities (ABSs). As of the end of June, corporate ABSs for the first time took over so-called “credit” ABSs, backed mainly by bank loans, as the country’s most popular asset-backed structured products. Through securitizing unpaid bills and outstanding debts, companies can fill their funding gap by monetizing income-generating assets without disposing of them. However, like most other structured products, credit risks of the underlying assets aren’t always clear. The existing framework on regulating ABSs in China also needs to keep up with the growth of the sector to better protect investors and prevent systemic risks from building up while remaining conducive to innovations, say regulatory sources and market watchers.