argues the challenges of entrepreneurial financing and innovation in the context of China, stating thattThe Chinese Government wants China to be an innovative economy and realized the significance of creating a more innovative economy through the support of SMEs capabilities. Even though they have established the 12th Fiver Year National Economic and Social Development plan for supporting the development of SMEs, the country needs to enhance its policies and regulations to offer adequate support for small and innovative business enterprises. Therefore, the policymakers need to make appropriate changes to enhance the competitiveness of Chinese SMEs. S