In recent years, China’s capital market has experienced rapid growth. However, the market financing environment for high-risk enterprises has not seen significant improvement and may even be trending towards deterioration. The deterioration can lead to a crowding-out effect on investments in small and medium-sized enterprises and fails to effectively support the real economy with finance.

A substantial body of literature, from the perspective of commercial banks, has examined their willingness to take risks in the allocation of credit resources. However, there are fundamental differences between financial markets and commercial banks in the allocation of financial resources, because it is about matching investors’ asset demands with the asset supplies of enterprises and governments for financial markets. Therefore, to understand the financing difficulties of high-risk enterprises in the market context, it is necessary to analyze from the perspective of asset supply.

This paper analyzes the impact of safe-asset supply on the financing of enterprises with different risk characteristics from both theoretical and empirical perspectives. Evidence from both macro and micro aspects reveals that a decrease in the supply of safe assets will lead to differentiation in the financing environment for non-financial enterprises, leading to higher financing costs and a lower financing scale for high-risk enterprises relative to low-risk ones.

This paper starts from China’s reality and the perspective of corporate financing, measuring for the first time the supply of safe assets in China and directly linking the supply of safe assets to corporate financing and differentiation issues, thus expanding the research scope of literature in the safe-asset field. In the future, it will be essential to enhance policy coordination between finance and fiscal authorities to ensure a relatively steady supply of safe assets and improve the financing environment for enterprises.