FINANCE

China Rolls Out Loan Subsidy Package to Boost Domestic Demand

Published: Jan. 20, 2026 4:50 p.m. GMT+8

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China’s Ministry of Finance on Tuesday rolled out a package of interest rate subsidies, launching a new program for small private businesses and expanding existing incentives for equipment upgrades, services and household consumption to support domestic demand.

The measures align with recent monetary easing by the central bank and aim to lower financing costs across key parts of the economy.

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China introduced new interest rate subsidies, including a 1.5 percentage point loan subsidy for small private businesses from 2026, capped at 50 million yuan per borrower for two years.
Subsidies for equipment upgrades and service sector loans were increased and expanded, with broader eligibility and higher loan caps.
Fiscal subsidies for consumer loans were extended and now include credit card installment plans to support domestic demand.

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What Happened When

From the start of 2026：: New loan subsidy program for private small, medium, and micro enterprises offers an annual interest subsidy of 1.5 percentage points for eligible loans issued from this date.

January 20, 2026：: China’s Ministry of Finance announced a package of interest rate subsidies, launching a new program for small private businesses and expanding existing incentives for equipment upgrades, services, and household consumption.

AI generated, for reference only