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17:35, 15-Dec-2017
China releases new measures on automatic pledge financing
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China's central bank has announced measures to regulate automatic pledge financing to improve the efficiency of payment systems.
The changes, which take effect from January 29, specify the financing balance limits of different financial institutions, unify daytime and overnight rates of automatic pledge financing, and expand the scope of collateral bonds, said the People's Bank of China (PBOC) in a statement.
Automatic pledge financing business is a payment support mechanism for financial institutions. It automatically provides funding when the clearing accounts of financial institutions face a funding shortage.
The mechanism helps improve clearing efficiency and ensure clearing security, but is not a liquidity tool, said the PBOC.
Source(s): Xinhua News Agency