China Allocates RMB 100 Billion for Fiscal-Financial Policies to Boost Domestic Demand

The central government has allocated RMB 100 billion in special funds for 2026 to implement six fiscal-financial policies designed to boost domestic demand. Latest data show that in the first seven months, cumulative new credit disbursed in related sectors exceeded RMB 20 trillion, an increase of more than RMB 880 billion compared with the same period in 2025. A large number of business entities, especially small and medium-sized enterprises, have obtained low-cost loans through fiscal interest subsidies and financing guarantees, while many consumers have benefited from fiscal interest subsidies on personal consumption loans.

At a meeting of the Political Bureau of the Communist Party of China Central Committee held on July 30, it was proposed to optimize the implementation of fiscal-financial policies to boost domestic demand. Relevant authorities have since refined these policies, including broadening the scope of interest subsidies, adding handling institutions, and raising the upper limits. New working capital loans have been included in the scope of interest subsidies for small and medium-sized enterprises, and the cap on interest subsidies for personal consumption loans has been raised from RMB 3,000 to RMB 5,000. In addition, more handling institutions have been added to facilitate access for businesses and consumers.

The Ministry of Finance has indicated that it is continuing to study and formulate new fiscal-financial coordination policies and measures, while promoting the normalization and long-term effectiveness of fiscal-financial linkage.