(Bloomberg) — The People’s Bank of China said it will set up a relending program of as much as 500 billion yuan ($69 billion) to support innovation and project upgrades in the science and technology sectors.
The loans will have an interest rate of 1.75% and a tenor of one year, which can be extended twice for an additional year, according to a statement posted on the PBOC’s website Sunday. The loan quota will be allocated to 21 banks.
The refinancing program is set to help small- and medium-sized technology firms in their initial startup and growth stages and provide credit support to high-end projects, it said.
The new lending initiative is in line with plans announced by PBOC governor Pan Gongsheng in March and follows hints from China’s top economic officials about a potential liquidity boost. Policymakers are looking to lift confidence in the world’s second-biggest economy as a lingering property crisis and weak consumer sentiment threaten to weigh on the growth outlook.
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