Finance
PBOC Gives Banks Cheaper Funding for Loans to Green Firms
- Lenders encouraged to support firms in clean energy sectors
- Program reduces need for RRR or interest rate cut: analysts
Chinese workers prepare solar panels
Photographer: Kevin Frayer/Getty Images AsiaPacThis article is for subscribers only.
China’s central bank will offer cheap funding to banks which lend to firms that are working toward the nation’s goal of reducing carbon emissions.
The People’s Bank of China will lend financial institutions money to help them provide loans to firms working on China’s energy transition, according to a statement Monday evening. The central bank will lend 60% of the required funds at an interest rate of 1.75%, and banks can then use the money to provide loans at a higher rate around the level of the loan prime rate.