China's financial institutions have taken measures to step up the rollout of consumer loan subsidy programs during the ongoing eight-day National Day and Mid-Autumn Festival holiday season to spur holiday spending nationwide.
At a shopping mall in Shanghai, a customer surnamed Wang was browsing through home appliances, taking full advantage of the holiday sales to furnish his new apartment in one go.
"I want to purchase all the appliances at once, so I've taken out a consumer loan. As consumer loans are subsidized by the state, the state subsidy can help ease my financial burden, and the process is very convenient. It allows me to quickly get everything I need," Wang said.
Wang's purchases of home furnishings and electronics qualified for a government interest subsidy, allowing him to enjoy a one percent annualized discount. Eligible consumer loans can receive a maximum subsidy of 3,000 yuan (about 420 U.S. dollars) in interest rate discounts. The financial product offers fully online approval, and when it's time to repay, the subsidized interest rate is automatically deducted, making the process both straightforward and cost-effective. "Market response shows the subsidy policy has effectively energized consumer activity. Our consumer loan issuance has risen by 14 percent month on month, with auto loans up 12 percent month on month," said Yang Liwen, general manager of the Retail Credit Business Department, the Bank of Communications.
In Meishan City, southwest China's Sichuan Province, the city has kicked off its 30th annual Consumption Season campaign. This year's campaign is of several new features, with multiple banks launching mobile service counters offering on-site consumer loan applications processing. As a result, consultations and purchase inquiries have increased by over 50 percent year on year.
"For this year's Consumption Season, we've opened a green approval channel. After making purchases, customers can immediately apply for consumer loans here, get approved in real time, and enjoy discounted rates," said Zhu Kai, customer manager of the Dongpo District Branch, the Postal Savings Bank of China (Meishan).
China's loan interest subsidy policies spur holiday consumption
