Where will credit resources be focused in 2026? The central bank's major meeting clarifies

Recently, the People’s Bank of China held the 2026 Credit Market Work Conference. The meeting summarized the credit market work in 2025, analyzed the current situation, and deployed tasks for 2026. Zhu Hexin, member of the Party Committee of the People’s Bank of China and Vice Governor, who is in charge of the Credit Market Department, attended the meeting and delivered a speech.

The meeting clarified the need to further improve the mechanisms of the five major financial articles, implement the incremental policies of structural monetary policy tools, strengthen coordination with fiscal policies, vigorously develop science and technology finance, green finance, inclusive finance, pension finance, and digital finance, and enhance financial support in the consumption sector. It also emphasized building a multi-level financial service system to support expanding domestic demand, technological innovation, and small and micro enterprises, among other key areas.

A local regulatory official told reporters that one of the main focuses of this meeting was “implementing the incremental policies of structural monetary policy tools and strengthening coordination with fiscal policies,” which is highly consistent with the previous stance of the central bank to increase support for structural monetary policy tools and further assist in economic restructuring and optimization.

On January 15, Zou Lan, spokesperson for the People’s Bank of China and Vice Governor, announced at a State Council Information Office press conference that the interest rates for various structural monetary policy tools would be lowered by 0.25 percentage points, an additional 500 billion yuan of re-lending quotas for supporting agriculture and small businesses would be added, and the re-lending quota for science and technology innovation and technological transformation would be increased to 1.2 trillion yuan, among eight policy measures aimed at further strengthening support through structural monetary policy tools.

When asked about “the next steps for monetary policy,” Zou Lan clearly stated that the central bank will continue to implement a moderately relaxed monetary policy to create a suitable monetary and financial environment for boosting consumption and expanding domestic demand. Based on this, it will further leverage the structural guiding role of monetary and credit policies, continuously improve the support for consumption, and enhance the effectiveness and adaptability of financial support for consumption.

First, improve the effectiveness of financial support in key areas of consumer services. The People’s Bank will further expand support for service consumption and pension re-lending. Once relevant industry authorities clarify the standards for health industry recognition, the health industry will be included in the support scope for service consumption and pension re-lending. Through appropriately favorable re-lending interest rates, financial institutions will be encouraged to increase credit issuance in the consumption sector according to market-oriented and rule-of-law principles. It will also continue to guide financial institutions to innovate products and services based on consumption scenarios, with a focus on supporting industries closely related to people’s livelihoods such as accommodation and catering, cultural tourism, sports and entertainment, elderly care and childcare, and domestic services.

Second, promote the enhancement of residents’ consumption capacity and support genuine consumption financing needs. Continue to implement the entrepreneurial guarantee loan policy, support employment and entrepreneurship for key groups, and help eligible small and micro enterprises absorb employment. Support the healthy and stable development of China’s capital markets and increase residents’ investment channels. Regulate the development of consumer finance to meet diverse and personalized consumer needs. Strengthen coordination between financial and fiscal policies, and implement policies such as loan interest subsidies in the consumption sector to reduce financing costs.

Third, optimize the basic services of consumer finance. Continuously improve diversified payment service systems, enhance payment experiences based on key consumption scenarios, implement the one-time credit repair policy, and improve the environment for consumer finance.

At the recent 2026 Party Building and Business Management Work Conference, several state-owned banks expressed their commitment to further clarify credit support measures, focusing on promoting consumption and expanding domestic demand. For example, Industrial and Commercial Bank of China stated that it will proactively serve the “two supports and one broad” (supporting employment and entrepreneurship, supporting small and micro enterprises, and broadening the economy), actively benefit people’s livelihoods, promote consumption, and help the service industry expand capacity and improve quality. Agricultural Bank of China said it will adhere to integrating investment in physical assets with investment in people, continuously increase financial support in the “two supports,” “two new” areas, and sectors related to people’s livelihoods and consumption. Bank of Communications stated that it will focus on serving the real economy, firmly support the development of new productive forces, and fully serve to promote consumption and benefit people’s livelihoods.

Supporting the Resolution of Debt Risks in Financing Platforms

The meeting also emphasized continuing to support the resolution of debt risks in financing platforms, supporting local governments in steadily advancing market-oriented transformation of financing platforms, and guiding financial institutions to provide services according to market-oriented and rule-of-law principles. It called for strengthening macro thinking and problem-oriented approaches, continuously improving work styles, and establishing a dynamic “implementation-evaluation-optimization” policy cycle to enhance the effectiveness of policies in benefiting the people and enterprises.

The recently held 2026 China People’s Bank of China Work Conference stated that this year’s key tasks include prudently resolving financial risks in key areas. It also reiterated the importance of supporting the resolution of debt risks in financing platforms and advancing their orderly exit.

In December last year, the central bank released the “China Financial Stability Report (2025)” (hereinafter referred to as the “Report”), which in the section “Progress in Supporting the Resolution of Debt Risks in Financing Platforms” noted that through multi-party efforts, most financing platforms have achieved debt rollover, restructuring, and replacement upon maturity. The burden of financing costs has significantly decreased, and debt risks in financing platforms have been greatly alleviated. The order of the financial market and the financial ecological environment remain generally stable.

By the end of 2024, compared to early 2023, about 40% of financing platforms had exited the financing platform sector through market-oriented transformation and other means. At the end of 2024, the scale of operational financial debt of financing platforms was approximately 14.8 trillion yuan, a decrease of about 25% from early 2023. In the fourth quarter of 2024, the average interest rate of newly issued bonds by financing platforms was 2.67%, over 2 percentage points lower than in the first quarter of 2023, indicating a significant decline in the risk premium for raising funds in the financial market.

The “Report” clearly states that the next step for the People’s Bank of China is to implement various policies for resolving debt risks in financing platforms, steadily promote their transformation and development, and effectively enhance their operational capacity. It will guide financial institutions to continue debt rollover, restructuring, and replacement according to market principles, maintain support for key areas, weak links, and major projects, and foster a healthy cycle of debt resolution and development.

Yang Zhi’an, Dean of the Local Government Debt Research Institute at Liaoning University, believes that systematically resolving the operational debt risks of local financing platforms requires a sound institutional framework to ensure normalized and standardized risk prevention. One key task is to strengthen the linkage between financial regulation and fiscal regulation, standardize the financing behavior of financial institutions toward platform companies, strictly prohibit illegal government-backed financing, and guide financial institutions to assess the credit risks of platform companies based on market principles, forming a market-oriented financing constraint mechanism.

(Source: 21st Century Business Herald)