The People’s Bank of China has announced an increase of 400 billion yuan in the share of on-lending for technological innovation and equipment renewal. With this increase, the total volume of the program reaches 1.2 trillion yuan, reinforcing financial support for the modernization of the country’s productive fabric.

To whom the measure is addressed

The program is aimed at companies undertaking technological innovation and equipment modernization projects, with a special focus on small and medium-sized enterprises. From 2026, the scope is explicitly extended to private SMEs with high levels of investment in R&D, which become beneficiaries of this financial instrument.

The scheme is channeled through 21 selected banks, which grant loans to eligible companies on favorable terms, with the backing of the central bank.

Financing conditions

Under the program, the central bank offers on-lending equivalent to 60% of the principal amount of loans granted by commercial banks. These loans are granted at reduced interest rates, with the aim of lowering the cost of financing and accelerating decisions to invest in productive assets.

The on-lending system, common in Chinese monetary policy, implies that the State finances financial institutions so that they can pass on advantageous conditions to companies, which reinforces the direct impact of the measure on the real economy.

Types of equipment and incentive investments

The financing is aimed at the renewal and modernization of equipment, as well as projects related to technological innovation and the improvement of productive capacities. The program seeks to facilitate the updating of the industrial park, the incorporation of advanced technologies and the promotion of higher value-added processes.

This approach places investment in equipment and technology as one of the central axes of Chinese economic policy for the coming years, with direct implications for international suppliers of machinery and industrial solutions.