China's central bank has set forth detailed plans for boosting financial support in key areas of economic development in the new year.
The People's Bank of China (PBOC) outlined its monetary and financial priorities for 2025 following a two-day meeting that ended Saturday.
The central bank pledged to utilize structural policy tools to promote steady economic recovery and development, with priorities given to technology finance, green finance, inclusive finance, pension finance, and digital finance.
The PBOC set apart 500 billion yuan of loan renewal funds to support technological innovation and industrial upgrades in 2024 in a bid to direct financial resources toward technology-driven small and medium-sized enterprises (SMEs). Over the past three years, medium- and long-term loans to high-tech manufacturing industries and loans for technology-based SMEs have consistently grown at rates exceeding 20 percent. The loan approval rate for technology-driven SMEs has increased from 35 percent to 50 percent.
"We will continue to refine the re-loan policies regarding technological innovation and industrial upgrades and increase support with policy tools. With loans and new bonds, we shall actively cultivate a financial market ecosystem that supports technological innovation. We will improve financial services for science and technology in key areas while actively and steadily promoting the construction of science and technology finance pilot zones," said Peng Lifeng, director of the credit market department at the PBOC.
In terms of green finance, the POBC will optimize tools for advancing carbon reduction and improve the evaluation of green financial initiatives. Efforts will also be made to form innovative lending and bond programs to support green development, according to Peng.
The bank is also expanding inclusive financing efforts, continuing to ramp up its support for the agricultural sector, including the use of monetary policy tools such as re-loans and reserve requirements.
"We will continue to improve the credit guarantee system and enhance financial service evaluations for private SMEs. We will also ensure the effective implementation of entrepreneurial guarantee loans and student loans to increase accessibility, convenience, and coverage in the inclusive finance sector," said Peng.
The credit market director also outlined plans to strengthen the financial support system for the elderly and improve the efficiency of pension re-loan funds. The central bank will guide financial institutions to offer greater support for health industries and the senior care sector, focusing on long-term solutions for an aging population.
On digital finance, Peng said the bank aims to optimize services, customize new policy measures to support new industrialization, foster a high-level financial data market and promote the digital and intelligent transformation of financial services.
"Focusing on the key task of boosting consumption in 2025, we will explore innovative financial products and tools, further enhancing financial support for key consumption sectors," he said.
China to boost financial support in key areas with structural policy tools
