BEIJING - Chinese Premier Wen Jiabao has urged stronger financial support for China's small businesses and better regulation of private lending activities to prevent risks of capital shortage from spreading.

Small enterprises should be a priority of bank credit support and enjoy more tax preferences from the government, said Wen during visits to east China's economic hub Zhejiang Province on Monday and Tuesday.

Banks should increase their tolerance of the non-performing loan (NPL) ratio of small enterprises, set targets for the proportion and growth of loans to small companies and reduce the small businesses' cost of securing credit, said the premier.

Small businesses, which create 80 percent of China's jobs and generate 60 percent of the country's industrial output, have long complained about difficulties in securing loans from banks, which prefer to lend to large companies that are considered safer bets.