BEIJING - China's Ministry of Finance (MOF) said on Tuesday that eight categories of eligible service sector businesses will benefit from a new loan interest subsidy policy action plan recently unveiled by nine government departments, including the MOF.
The action plan targets service sector businesses in the categories of catering and accommodation, health care, elderly care, childcare, housekeeping, culture and entertainment, tourism and sports, according to the MOF.
To qualify for the subsidy, loans must be extended between March 16, 2025 and December 31, 2025 -- and loans must be used for improving consumption infrastructure or service supply capacity.
Under the plan, borrowers may receive interest rebates of 1 percentage point annually for no more than one year, with the central government covering 90 percent of subsidies and provincial authorities responsible for the remaining 10 percent. The maximum loan amount eligible for subsidies per operator is 1 million yuan (about $140,000).
A total of 21 banks have been designated to implement the plan -- with qualifying borrowers applying directly to these banks.
The plan forms part of China's broader efforts to stimulate services consumption and cultivate new growth drivers.
Meanwhile, China will provide interest subsidies for qualifying personal consumption loans in the country's latest effort to boost consumption, according to an official announcement on Tuesday.
The provisions outlined in the announcement, issued jointly by the Ministry of Finance, the People's Bank of China and the National Financial Regulatory Administration, will be implemented from Sept 1 this year to Aug 31, 2026.
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During this period, individuals may receive interest subsidies on portions of personal consumption loans, excluding credit card business, issued by lending institutions -- provided the funds are actually used for consumption purposes and transactions can be verified through loan disbursement accounts.
Covered expenditures include single transactions under 50,000 yuan (about $7,001), as well as priority sector transactions of 50,000 yuan or more involving household automobiles, elderly care and childbirth support, education and training, culture and tourism, home furnishings and decoration, electronics, and health and medical services. For single transactions exceeding 50,000 yuan -- the maximum subsidized consumption amount per transaction is capped at 50,000 yuan.
The subsidies may be extended or expanded to consumption in more areas based on implementation outcomes, the announcement said.
The subsidy standard specifies an annual subsidy rate of 1 percentage point, not exceeding 50 percent of the loan contract interest rate, which must comply with applicable self-regulatory rate requirements.
The central government will cover 90 percent of subsidy funds with provincial governments contributing 10 percent. Individual borrowers face a cumulative subsidy limit of 3,000 yuan per lending institution, including a sub-limit of 1,000 yuan specifically for transactions under 50,000 yuan at a single institution.
Qualified lending institutions comprise six state-owned commercial banks, 12 national joint-stock commercial banks and five designated consumer lenders. Local governments are encouraged to extend subsidies to regional financial institutions to broaden policy coverage.
