BEIJING - China is mulling measures to address the proliferation of unlicensed financing guarantee companies, according to a draft regulation issued by the Legislative Affairs Office of the State Council on Wednesday.

According to the draft, licensed financing guarantee companies and their branches will have their licenses confiscated if they are not in the business for one year or more without justified reasons.

Moreover, organizations or individuals, without licenses, are not allowed to run such businesses or feature "financing guarantee" in the names of their companies, according to the draft.

Financing guarantee businesses have developed rapidly in recent years, according to the Legislative Affairs Office. By December 2014, there were 2,898 across the country, with a protected balance of 2.74 trillion yuan ($429.1 billion).

The draft regulation is now open for public opinion, it can be accessed via chinalaw.gov.cn. Opinions will be accepted until Sept 12.