Economics
China's Central Bank Unveils Targeted Lending Plan to Aid Growth
- Reduction aims to help entrepreneurs and farmers obtain credit
- Central bank repeats prudent, neutral monetary policy pledge
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China’s central bank said it will reduce the amount of cash lenders must hold as reserves from next year, with the size of the cut linked to the flow of funding to parts of the economy where credit is scarce.
The targeted measures apply to all major banks, 90 percent of city commercial banks, and 95 percent of rural commercial lenders, the People’s Bank of China said in a statement late Saturday. Cuts will range from 0.5 percentage point to 1.5 percentage point depending on how much business banks do with small enterprises, agricultural borrowers and startups. Foreign banks will also be eligible for the cut should they meet the requirements.