This year, a notable feature has been added to China's macroeconomic policy toolkit: fiscal and financial policies are working in concert to stimulate domestic demand. A special fund of 100 billion yuan has been established for this purpose, utilizing a combination of measures such as loan interest subsidies, financing guarantees, and risk compensation to support the expansion of domestic consumption.
This represents a precise collaboration between fiscal and financial authorities. Since the policy's announcement, various regions and departments have accelerated its implementation, allowing businesses and consumers to feel the tangible benefits of this substantial support.
Interest subsidy policies are reducing burdens, encouraging companies to borrow and invest confidently. At a medium-sized home appliance manufacturer in Zhejiang, production lines are operating at full capacity. "Thanks to the loan interest subsidy policy, we secured a 20-million-yuan low-interest loan, saving over 300,000 yuan in annual interest payments," calculated the company's负责人. The funds were allocated towards intelligent upgrades, resulting in a 20% increase in production efficiency after the new production line became operational.
This exemplifies how fiscal subsidies can achieve significant impact with minimal input. By lowering corporate financing costs, fiscal funds leverage bank credit to flow more rapidly into the real economy, particularly into key areas for expanding domestic demand like consumer goods manufacturing and commercial circulation.
Multiple banks, catering to residents' diverse and differentiated consumption needs, are continuously improving their consumer finance product systems. These now comprehensively cover scenarios including household automobiles, home purchase and renovation, education and training, cultural tourism, health care, and daily consumption.
For key groups such as new urban residents and university graduates, Bank of China has been expanding the coverage of consumer loans and enhancing service efficiency. For cross-border consumers, services have been upgraded through improved student loans and dedicated card offerings, comprehensively enhancing the convenience of cross-border financial services and ensuring precise reach of financial support.
Simultaneously, to ensure policy benefits are delivered seamlessly, Bank of China leverages its technological capabilities. It has launched a dedicated "Consumer Loan Interest Subsidy" section within its mobile banking app, integrating functions for subsidy agreement signing, inquiry, and automatic deduction, aiming to reduce the cost of consumer loans for residents.
The warmth of these policies ultimately reaches households through specific consumption scenarios. In Jiangsu, Mr. Zhang, planning a family reunion trip to Hong Kong and Macau during the Spring Festival with an estimated cost of 80,000 yuan, benefited from Bank of China's interest subsidy policy. By taking out a one-year loan, he received a direct interest reduction of 800 yuan, with the entire process from approval to disbursement completed within a single day, enabling a worry-free reunion journey.
A similar positive experience occurred in Beijing, where Ms. Zhang, guided by a Bank of China relationship manager, applied for a "Mind-Ease Loan" through a mobile order system and signed the interest subsidy agreement online. She remarked, "The funds were credited after just a few simple steps on my phone. It not only addressed my need for a large amount for renovation but also allowed me to enjoy a state subsidy—it's both convenient and cost-effective."
The two key consumption-stimulating policies—fiscal interest subsidies for personal consumption loans and for loans to businesses in the service sector—are exerting force from both the supply and demand sides, leading to a recovery in consumer market activity. Statistics show that these policies benefited consumer spending by approximately 500 billion yuan nationwide in the first quarter.
Beyond significantly promoting consumption, the combined fiscal and financial measures are also focused on expanding investment, particularly stimulating private investment. By comprehensively utilizing policies such as interest subsidies for loans to small and micro-enterprises, subsidies for equipment renewal loans, and special guarantee schemes for private investment, a multi-tiered financing support system is being built. This system not only reduces financing costs but also lowers the financing threshold.
This year, the equipment renewal loan interest subsidy policy has been optimized. Beyond the original scope of equipment purchase projects, fixed-asset loans related to equipment updates and loans for technological innovation have been included. Eligible enterprises can receive interest subsidy support equivalent to 1.5 percentage points of the total loan amount, for a period not exceeding two years.
Recently, at the intelligent manufacturing industrial park of Fujian Yongsheng Footwear, the expansion project for finished shoe production lines and supporting construction entered a critical phase. The company's financial officer, Chen Haixia, stated that China Construction Bank provided a 52.68-million-yuan equipment renewal loan for the project. Combined with the interest subsidy policy, the company can save nearly one million yuan in financing costs annually. "We didn't expect the combination of fiscal subsidies and bank loans to work so smoothly, tangibly reducing the burden of our intelligent upgrade," she noted.
The head of a hydraulic equipment enterprise in Beijing expressed a similar sentiment. Facing significant funding pressure for upgrading hydraulic components and complete system equipment during its operational transformation, the company received efficient approval and disbursement of an equipment renewal loan from the Industrial and Commercial Bank of China's Beijing Branch. The bank also strengthened coordination between government, banking, and enterprise through measures like dedicated consultation activities, providing comprehensive support to enhance the company's competitiveness.
A relevant负责人 from China Construction Bank's Inclusive Finance Department stated, "For eligible fixed-asset loans issued by CCB to small, medium, and micro private enterprises starting January 1, 2026, and for funds from new policy-based financial instruments used in projects involving these enterprises, the central government will provide an interest subsidy support of 1.5 percentage points annualized on the loan principal, for a period not exceeding two years. The maximum subsidized loan amount per borrower is 50 million yuan."