China expands financial policies to support economic growth, risk prevention, cross-border capital management
China's monetary authorities on Thursday outlined a series of measures aimed at boosting economic recovery, strengthening financial stability, and enhancing cross-border capital management.
A view of the People's Bank of China headquarters in Beijing, China, February 21, 2025. /VCG
Strengthening financial support for economic growth
The People's Bank of China (PBOC) reaffirmed its commitment to implementing a moderately loose monetary policy to maintain sufficient liquidity and balance economic stability. Key priorities include providing enhanced financial support for technological innovation, green finance, small businesses, and infrastructure projects. Financial reforms will also be deepened to improve policy transparency and maintain market stability, fostering sustainable economic development.
To further stimulate growth, the National Financial Regulatory Administration (NFRA) announced targeted financial support measures, including the introduction of a "super-long-term government bond + super-long-term loan" service model to fund major infrastructure and industrial projects. Additionally, it aims to boost financing for small and private enterprises, encourage financial investment in innovation, and expand pilot programs in areas such as equity investment by financial asset management firms, long-term insurance fund investments, technology mergers and acquisitions, and intellectual property finance.
Cranes were observed in operation for a real estate development in Wenzhou, Zhejiang Province, China, February 6, 2025. /VCG
Mitigating financial risks
The NFRA highlighted risk prevention as a key priority for 2025. Measures will focus on restructuring and transforming local small and medium-sized financial institutions through capital replenishment, mergers, acquisitions, and market exits. Additionally, it will enhance urban real estate financing coordination, ensure timely housing project completions, and accelerate the development of new financing mechanisms tailored to the evolving real estate sector.
On the regulatory front, efforts will be made to enhance financial supervision, address regulatory gaps, advance legislative reforms in banking and insurance laws, and strengthen coordination between central and local regulators. Authorities also pledged to maintain strict enforcement against illegal financial activities, improve consumer financial protection, and refine risk monitoring frameworks.
A display of live exchange rates in Shanghai, China, January 14, 2025. /VCG
Expanding cross-border capital management pilot program
To further improve financial services for foreign trade and investment stability, the PBOC and the State Administration of Foreign Exchange (SAFE) announced the expansion of a pilot cash-pooling service that integrates domestic and foreign currency management for multinational companies.
The program is currently being piloted in 10 localities and will be expanded to various regions, including Tianjin, Hebei, Anhui, Fujian, Shandong, Hunan, Sichuan, Yunnan and Xinjiang.
Policies that will be piloted in these additional regions include those that allow multinationals to use their domestic master accounts in China to handle centralized receipts and payments in domestic and foreign currencies for overseas subsidiaries, and those that streamline yuan-denominated cross-border receipts and payments for multinationals.
(With input from Xinhua)