The People’s Bank of China (PBOC) on Sunday announced the creation of a special relending facility worth 500 billion yuan (approximately $70.47 billion). This initiative aims to strengthen sci-tech innovation, technical transformation, and the renewal of essential equipment.
The one-year facility offers an attractive interest rate of 1.75 percent, with the possibility of two one-year extensions, according to the PBOC statement. By providing low-cost funds, the PBOC seeks to encourage financial institutions to increase credit support for sci-tech-focused small and medium-sized enterprises (SMEs) in their early or growth stages.
Additionally, the relending program targets technical transformation and equipment renewal projects, helping key sectors enhance their digitalization, smart technologies, advancement, and sustainability. The PBOC will extend these funds to 21 financial institutions, including China Development Bank and Postal Savings Bank of China, among others.
Under the program, eligible loans issued by these institutions will receive reloans equivalent to 60 percent of the loan principal, thereby facilitating substantial support for innovative and sustainable projects across various industries.
Reference(s):
China's central bank unveils relending program for sci-tech innovation
cgtn.com
