Financing alternatives for small and medium enterprises in China are discussed in the present study. In particular, we analyze the significant changes and developments in China’s “second board” stock market. China’s extensive network of regional assets and equity exchanges, which were set up to facilitate private equity transfer, and non-performing loan transactions seem to partially fill the void for small and medium enterprises, which cannot easily obtain approval for listing on the stock exchanges. Foreign investors can identify investment opportunities in non-listed domestic state-owned and private businesses through these regional assets and equity exchanges. At the same time, foreign stock markets are now attracting the young Chinese enterprises to list their stocks on their exchanges. Financing alternatives for small and medium enterprises in China are discussed in the present study. In particular, we analyze the significant changes and developments in China’s “second board” stock markets. China’s extensive network of regional assets and equity exchanges, which were set up to facilitate private equity transfer, and non-performing loan transactions seem to partially fill the void for small and medium enterprises, which can not easily obtain approval for listing on the stock exchanges. Foreign investors can identify investment opportunities in non-listed domestic state- owned and private businesses through these regional assets and equity exchanges. At the same time, foreign stock markets are now attracting the young Chinese enterprises to list their stocks on their exchanges.