The People's Bank of China is offering more than 200 billion yuan ($28.7 billion) in special credits to commercial banks to boost loans to businesses, in the latest effort by authorities to prop up the economy.
According to a report published by the official Xinhua news agency, the State Council announced after Tuesday's meeting that the funds would be used to support banks in providing loans to companies that are upgrading their equipment during the fourth quarter.
Banks have been encouraged to lend to companies in the manufacturing and services sector as well as small businesses at an interest rate of no more than 3.2 percent, the report said.
The central bank is set to provide banks with funds equivalent to these loans for a year through the re-lending program, which can be extended twice.
In addition, smaller companies will also be able to defer tax payments for another four months, providing tax breaks worth 440 billion yuan.
