China is overhauling the way it lends to developing nations, a strategy that may help their largest official creditor maintain a narrowing lead over the US and its Group of Seven allies.

Beijing has begun moving away from the big bilateral deals it was eager to strike a decade ago — when it first launched its flagship Belt and Road Initiative that mainly lends to infrastructure projects — in favor of collaborative lending that reduces its exposure to financial risk, according to a new report published by AidData at William and Mary, a public university in Virginia.