China Launches $72 Billion Loan Guarantee Plan to Boost Private Sector Lending
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China on Tuesday unveiled a 500 billion yuan ($72 billion) state-backed loan guarantee program aimed at boosting private investment and easing credit access for small and midsize enterprises, marking a major shift in how lending risks are distributed between banks and the government.
The two-year plan, jointly announced by the Ministry of Finance and three other agencies, seeks to reinvigorate the private sector by expanding credit guarantees and doubling the loan ceiling for qualifying borrowers. By increasing the government’s share of risk, officials hope to stimulate domestic demand and unlock long-term capital investment.
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- China launched a 500 billion yuan ($72 billion) state-backed loan guarantee program to boost private sector investment and credit access for small and midsize businesses.
- The government will guarantee up to 80% of loan risks, with the loan cap per company doubled to 20 million yuan and compensation rates raised from 4% to 5%.
- Measures include a 1% fee cap, 5 billion yuan government injection, and extended fiscal support for loans and personal consumption through 2026.
- January 9, 2026：
- The State Council launched a wider fiscal-financial coordination initiative.
- January 21, 2026：
- China unveiled a 500 billion yuan state-backed loan guarantee program aimed at boosting private investment and easing credit access for small and midsize enterprises.
- January 21, 2026：
- The two-year plan was jointly announced by the Ministry of Finance and three other agencies.
- January 21, 2026：
- At a press conference, Vice Finance Minister Liao Min outlined the details of the new lending guarantee plan.
- January 21, 2026：
- Regulators announced interest subsidies for loans to small and micro businesses and extended fiscal support for personal consumption loans.
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