(Yicai) March 5 -- China’s financial regulator will introduce more supportive policies to boost the real estate sector, scientific and technological innovation as well as private businesses, the director of the National Administration of Financial Regulation said at the Two Sessions, which are the country’s annual policy setting meetings that are currently underway in Beijing. 

There will be two main priorities regarding financial support for the real estate sector this year, Li Yunze said today as part of the Two Sessions’ ‘Minister Channel.’ The first is to expand and improve financing coordination mechanisms and extend the ‘white list,’ which refers to a list of property developments that are eligible to receive financing, so that more projects can secure loans and to ensure the on-time handover of pre-sold housing.

The second is to formulate research-based supporting financing systems to support new models of real estate development and to promote the sustainable and sound development of the property market, he said.

Two financing coordination mechanisms were set up last year by the NAFR together with the Ministry of Housing and Urban-Rural Development, as well as the National Development and Reform Commission, he said. One is for real estate financing and the other is to support micro and small enterprises.

The real estate financing mechanism has already approved over CNY6 trillion (USD826.5 billion) in loans, benefiting more than 15 million homes, which have either been delivered or are under construction, Li said.

While the mechanism supporting small businesses helps to bridge the gap between banks and small firms by setting up dedicated teams at the district and county levels to visit businesses and recommend eligible firms to lenders. Since October last year, these teams have visited over 50 million companies, resulting in more than CNY10 trillion (USD1.3 trillion) in credit being granted.

In terms of supporting scientific and technological innovation, the watchdog has four pilot projects underway and has plans to steadily expand their scope, Li said.

The first pilot is for equity investments by financial asset investment companies. In 2024, the pilot was expanded to 18 cities across the country, with signed agreements already exceeding CNY350 billion (USD48.2 billion). This year, the NAFR plans to expand the pilot area and allow more financial institutions to participate.

The second pilot is the long-term investment reform for insurance funds. The initial scale has already exceeded CNY100 billion (USD13.7 billion). The NAFR will ramp up this effort and an additional CNY60 billion was approved just yesterday, he said.

The third pilot is for loans supporting the merger and acquisition of tech companies. The regulator is mulling raising the M&A loan cap to 80 percent from 60 percent of the acquisition funds and extending the loan term to 10 years from seven years, Li said.

The final pilot is a financial ecosystem for intellectual property. Li said the regulator plans to start the trial in regions with high innovation activity with the aim of solving problems such as the registration, evaluation and disposal of IP pledges.

Editor: Kim Taylor