Borrower's Application for Personal Consumer Loan Interest Subsidy: Required Procedures, Ministry of Finance Responds

According to the Ministry of Finance website, what procedures are required for borrowers to apply for fiscal interest subsidies on personal consumption loans? A relevant official from the Ministry of Finance answered reporters' questions regarding the "Implementation Plan for the Fiscal Interest Subsidy Policy on Personal Consumption Loans," stating that from the borrower's perspective, the overall process still follows the general loan procedures handled by the financial institution. At the same time, to effectively identify consumption transactions that meet the subsidy conditions, borrowers need to authorize the handling financial institution to obtain transaction information from the loan disbursement account or designated account, which will be used to conduct the review of subsidy funds.

A responsible official from the Ministry of Finance answers reporters' questions on the "Implementation Plan for the Fiscal Interest Subsidy Policy on Personal Consumer Loans."

To implement the decision and deployment of the Central Committee of the Communist Party of China and the State Council on vigorously boosting consumption and comprehensively expanding domestic demand, to fully leverage the guiding and driving role of fiscal policy, to strengthen the coordination and linkage between fiscal and financial sectors, to reduce the cost of consumer credit for residents, and to better stimulate consumption potential and enhance market vitality, the Ministry of Finance, in conjunction with the People's Bank of China and the National Financial Regulatory Administration, has jointly issued the "Implementation Plan for the Fiscal Interest Subsidy Policy on Personal Consumer Loans" (Cai Jin [2025] No. 80, hereinafter referred to as the "Plan"). Recently, a relevant official from the Ministry of Finance answered reporters' questions regarding the "Plan."

1. Promoting consumption and expanding domestic demand are the "key words" of this year's economic work. What is the background of the joint "Plan" issued by the fiscal and financial departments?

Consumption is a key link and important driver of national economic growth. Vigorously boosting consumption is not only an important measure to expand domestic demand and solidify the "ballast" of economic growth, but also an essential component to enhance people's well-being and meet the people's growing needs for a better life. Adhering to a people-centered development philosophy requires shifting the focus of economic policies more towards benefiting people's livelihoods and promoting consumption. This involves facilitating economic circulation through consumption boosting and leading industrial upgrading through consumption upgrading, thereby creating new economic growth points in the process of ensuring and improving people's well-being, and forming a virtuous cycle of economic development and improvement of people's livelihoods.

The Central Committee of the Communist Party of China and the State Council attach great importance to boosting consumption. Both the 2024 Central Economic Work Conference and the 2025 Government Work Report explicitly propose vigorously boosting consumption and enhancing investment efficiency, while expanding domestic demand in all aspects. In March 2025, the General Office of the Central Committee and the General Office of the State Council issued the "Special Action Plan for Boosting Consumption," which calls for the guiding and driving role of fiscal policy and provides fiscal interest subsidies for eligible personal consumer loans in 2025. To thoroughly implement the decisions and deployments of the Central Committee and the State Council, and in accordance with the spirit of the State Council executive meeting on July 31, the Ministry of Finance, together with the People's Bank of China and the National Financial Regulatory Administration, jointly issued the "Plan." This plan aims to further strengthen fiscal and financial coordination and linkage by implementing the fiscal interest subsidy policy for personal consumer loans. It supports residents' consumption with "real money," reduces the cost of consumer credit for residents, and simultaneously stimulates residents' consumption potential while supporting the expansion of domestic demand. This approach forms a "combination punch" with previously introduced policies, such as the trade-in policy for consumer goods and the concurrent fiscal interest subsidy policy for service industry business entities issued by the Ministry of Finance, to collaboratively exert efforts from both the demand and supply sides, intensifying efforts to boost consumption and consolidate the trend of sustained economic improvement.

The fiscal interest subsidy policy for personal consumer loans introduced this time is the first to be implemented at the central level. What are the prominent features in the policy design?

The first benefit is that it directly benefits individual consumers. Unlike previous interest subsidy policies that primarily supported the investment and supply sides, the recently introduced fiscal interest subsidy policy for personal consumer loans targets the demand side, directly benefiting individual consumers by reducing the cost of personal consumer loans. The subsidy funds are directly deducted by the relevant loan-handling institutions when collecting loan interest from borrowers, enhancing consumers' sense of happiness and satisfaction. In terms of the target groups, with the differentiated customer bases of commercial banks and consumer finance companies, the policy widely covers various groups, including salaried employees and flexible workers, thereby enhancing the policy's inclusiveness.

Second, it is closely aligned with the actual consumption needs of residents. The newly introduced fiscal interest subsidy policy for personal consumption loans supports the portion of personal consumption loans actually used for consumption during the policy implementation period. The scope broadly covers various daily life consumptions such as residents' "clothing, food, housing, and transportation," as well as key consumption areas closely related to residents' lives and involving relatively high capital investment, including household automobiles, elderly care and childbirth, education and training, cultural tourism, home furnishing and decoration, electronic products, health and medical care. This is conducive to meeting the diversified and multi-level consumption needs of the people, better supporting them to enjoy more convenient, richer, and higher-quality goods and services.

Thirdly, adhere to market-oriented and law-based operations. The plan clearly requires loan handling institutions to support the boosting and expansion of consumption while conducting credit evaluations and post-loan management in accordance with market-oriented and law-based principles. They must implement consumer loan interest rate policies and strictly enforce relevant personal consumer loan supervision and management regulations. Institutions are prohibited from using the introduction of policies to induce residents to borrow. Consumer loan amounts, terms, and interest rates should be reasonably set, and efforts should be made to identify borrower identity and consumption information, effectively strengthening the control of loan fund use and risks to prevent misappropriation for non-consumption fields and extracting subsidized funds.

Fourthly, emphasis is placed on strengthening departmental collaboration. To promote the efficient and standardized implementation of policies, the "Plan" implements full-process management for fiscal interest subsidies on personal consumer loans. It clearly delineates the responsibilities of the Ministry of Finance, the People's Bank of China, the General Administration of Financial Supervision, as well as the local regulatory bureaus of the Ministry of Finance, local financial departments, and financial regulatory bureaus. It specifies the processes for applying for, reviewing, and disbursing subsidy funds, and incorporates the policy implementation status of loan handling institutions into the daily supervision of financial regulatory departments to ensure effective policy implementation.

3. What are the main contents of this personal consumer loan interest subsidy policy?

The answer is: Firstly, regarding the support targets, it includes the portion of personal consumption loans issued by lending institutions to residents that is actually used for consumption. This covers individual consumption under 50,000 yuan, as well as key consumption areas of 50,000 yuan or more, such as household automobiles, elderly care and childbirth, education and training, cultural tourism, home furnishings and decoration, electronic products, and healthcare. This essentially covers all types of daily living consumption for ordinary residents, as well as key consumption areas with relatively larger expenditure scales. For key consumption areas with expenditure over 50,000 yuan, interest subsidies are provided up to a limit of 50,000 yuan.

Second, regarding the interest subsidy rate, the fiscal interest subsidy rate for personal consumer loans this time is an annualized 1%, roughly equivalent to one-third of the current commercial bank personal consumer loan interest rates. The basis for calculating the interest subsidy is the total eligible consumer amount paid by the borrower using personal consumer loans during the policy implementation period.

The third aspect involves loan handling institutions. The "Plan" specifies that these include six nationwide or cross-regional large state-owned commercial banks, twelve nationwide joint-stock commercial banks, and five consumer finance companies with relatively large business scales, as well as other institutions that issue personal consumer loans. Additionally, to expand policy coverage, local financial departments are encouraged to provide financial interest subsidies to other financial institutions engaged in personal consumer loan business based on actual conditions.

Fourth, in terms of the interest subsidy process, the central finance allocates interest subsidy funds to the provincial finance departments in advance according to a certain proportion based on the needs of the loan handling institutions. The provincial finance departments, based on the applications from the loan handling institutions and the summary provided by the local financial regulatory bureau, review and allocate the quarterly interest subsidy funds. After the policy implementation period ends, the financial departments and financial regulatory departments will settle the interest subsidy funds according to procedures.

The fifth aspect is the policy duration. The policy will be implemented for a period of one year, specifically from September 1, 2025, to August 31, 2026. During this period, eligible personal consumer loans can benefit from this interest subsidy policy. After the policy expires, the possibility of extending the policy duration and expanding the scope of support may be studied based on the implementation outcomes.

4. What procedures are required for a borrower to apply for government interest subsidies on personal consumer loans?

To minimize the operational burden on borrowers, the calculation, application, allocation, and settlement of fiscal interest subsidy funds for personal consumer loans are primarily handled by the loan processing institutions and government departments. This aims to ensure convenient processes, precise management, and efficient execution. While ensuring the compliance of the subsidy funds, the process is simplified as much as possible for borrowers. From the borrower's perspective, the loan is generally processed through financial institutions following the standard loan procedures. To effectively identify consumer transaction information eligible for interest subsidies, borrowers are required to authorize the processing financial institution to access transaction information from the loan disbursement account or a designated account for the purpose of subsidy fund verification. The authorization for relevant transaction information follows the principle of autonomy and voluntariness. If borrowers do not agree to authorize the processing financial institution to access the relevant transaction information, they will not be eligible for this interest subsidy policy. However, this does not affect the borrower’s ability to normally apply for, use personal consumer loans, and fully repay the loan principal and interest on their own.

V. How does the fiscal interest subsidy policy for personal consumer loans accurately support consumption?

The answer is: First, the subsidy is limited to the portion of personal consumer loans actually used for consumption. The "Plan" clearly stipulates that the subsidy range includes the portion of personal consumer loans issued by loan institutions that is actually used for consumption, including single consumption amounts below 50,000 yuan and single consumption amounts of 50,000 yuan or more in key areas. Subsidies will not be provided for portions of personal consumer loans that are not actually used for consumption.

Second, clarify the responsibilities of loan processing institutions in identifying borrowers' consumption information. According to the "Plan," while loan processing institutions collect interest from borrowers, they also review the transaction information of the relevant accounts to identify the portion related to consumption. For individual consumption transactions of 50,000 RMB and above, loan processing institutions are required to identify the field to which the consumption belongs. Based on the identification and review of relevant consumption information, loan processing institutions calculate the amount of government interest subsidies. When collecting loan interest from borrowers, they directly deduct the interest subsidy amount that should be borne by the government and submit an application for the disbursement of subsidy funds to the local provincial finance department and financial regulatory bureau as required.

Thirdly, establish a comprehensive review mechanism for the disbursement of interest subsidy funds. According to the "Plan," the disbursement of fiscal interest subsidy funds for personal consumer loans requires a three-tier review process: internal review by the lending institution, consolidation by financial regulatory bureaus, and verification by local financial departments. After the policy execution period ends, the Ministry of Finance will collaborate with the General Financial Regulatory Administration to timely organize relevant regulatory bureaus of the Ministry of Finance and relevant financial regulatory bureaus to inspect the application, review, and settlement of interest subsidy funds by lending institutions. Any issues identified will be dealt with in accordance with the law and regulations, ensuring that the interest subsidy funds are genuinely used to support consumption.

6. How to effectively organize and implement the "Plan"?

To promote the orderly implementation of the "Plan" and effectively achieve the policy goals of stimulating consumption and benefiting people's livelihoods, the Ministry of Finance will actively cooperate with relevant departments to carry out the following tasks: 1. Strengthen organizational coordination. Establish a special working mechanism between the central and local finance departments, as well as with relevant financial management departments, to collaboratively handle the review and allocation of interest subsidy funds, and the supervision and inspection of policy implementation. After the policy implementation period ends, work with financial regulatory departments to conduct a special review of the policy's implementation. 2. Urge local finance departments and financial management departments to ensure proper organization and implementation. Guide provincial-level finance departments and financial regulatory departments to strictly review interest subsidy funds and conduct daily supervision according to policy requirements, improving the precision and compliance of policy implementation. 3. Emphasize the primary responsibility of loan-handling institutions for calculating and reviewing interest subsidy fund applications. Guide loan-handling institutions to effectively implement the fiscal interest subsidy policy for personal consumption loans, strictly manage credit and risk control, and fulfill requirements for borrower consumption information identification, and interest subsidy fund calculation, review, and application. 4. Continuously track policy implementation. The Ministry of Finance, together with the People's Bank of China, the Financial Regulatory Authority, and other relevant departments, will closely monitor the policy implementation and the allocation and use of interest subsidy funds. For issues raised by various parties during policy execution, timely research and clarification will be provided; for any detected illegal or irregular behavior, relevant departments will pursue accountability according to laws and regulations.