Government Subsidy of Up to 30,000 for Consumer Loans
A reporter from Every News Zhang Shoulin and Li Yuman, Editor-in-Chief Zhang Yiming
On August 12th, the Ministry of Finance, the People's Bank of China, and the Financial Supervision Bureau jointly issued the "Implementation Plan for the Subsidy Policy on Personal Consumption Loans" (hereinafter referred to as the "Plan"), providing financial subsidies to eligible personal consumption loans.
From September 1st, 2025, to August 31st, 2026, residents can enjoy a maximum subsidy of RMB 3,000 (approximately USD 450) for their personal consumption loans, provided that the loan is used for actual consumer spending and the financial institution can identify the borrower's related consumption transactions through the loan account.
The Plan specifies that the annual subsidy rate will be 1%, with a maximum of 50% of the loan contract interest rate. Experts believe that the subsidy policy can effectively reduce consumers' borrowing costs, alleviate repayment pressure, and boost confidence, thereby releasing consumption potential.
The financial institutions involved in this policy are a total of 23 institutions.
According to the policy, the government will provide subsidies for individual loans exceeding RMB 50,000, with a maximum subsidy amount of RMB 5,000 (based on the actual consumption amount). The policy will be reviewed and extended if necessary, based on its implementation effects.
Specifically, the focus areas for subsidies include home appliances, elderly care, education, cultural tourism, household furnishings, electronic products, healthcare, etc.
The Plan specifies that the annual subsidy rate will be 1% (based on the actual loan amount), with a maximum of 50% of the loan contract interest rate. The central government and provincial governments will jointly bear the cost of subsidies in the ratio of 90:10.
During the implementation period, each borrower can enjoy a maximum subsidy of RMB 3,000 (approximately USD 450) for all personal consumption loans, with a cumulative consumption amount of RMB 30,000. For individual loans below RMB 5,000, the maximum subsidy will be RMB 1,000 (based on the actual cumulative consumption amount of RMB 10,000).
The financial institutions involved in this policy include 6 state-owned commercial banks, 12 joint-stock commercial banks, and 5 other personal consumption loan institutions.
How will banks implement the subsidy policy?
According to Research Fellow Li Yifan of the China Banking Research Institute, interviewed by Every News reporter, this subsidy policy will have a positive impact on both banks and consumers. Banks can optimize their loan products and services, enhance their customer relationships, and expand their loan business.
For consumers, Li Yifan believes that the subsidy can reduce their borrowing costs, alleviate repayment pressure, and boost confidence, thereby releasing consumption potential.
Banks have two ways to promote the implementation of the subsidy policy
In the future, banks will focus on the following areas:
On the one hand, they will actively explore growth points in various sectors, such as elderly care, healthcare, and education, while dynamically adjusting their financial resources to create a comprehensive consumer finance product line.
On the other hand, they will fully utilize big data and AI technology for pre-loan credit assessment, build user portraits, strengthen credit review, and design differentiated credit products and marketing strategies for different types of customers. This will enhance their financial sustainability and ensure stable business development.
Reporter noted that the Plan states that financial institutions will independently conduct differentiated lending based on marketization, legalization, and relevant credit management regulations. They will set reasonable loan amounts, interest rates, and repayment periods for individual loans, and make independent decisions on loan issuance and repayment.
According to Wang Pengbo, chief analyst at Bo Tong Consulting, consumers should carefully understand the policy details before applying for such loans and communicate with multiple financial institutions to choose the most suitable loan plan.