BEIJING – China will guide banks to boost credit in the consumer service industry, its financial regulator said on Thursday, as authorities seek to boost a flagging post-pandemic economic recovery.
“Residents’ consumption capacity is insufficient and their willingness to spend is not strong, consumption of big-ticket items is weak,” an official from China’s National Financial Regulatory Administration said in a briefing.
The foundations of the recovery of consumption activities are not particularly solid, and structural problems still exist, the official said.
The comments came after China pledged to improve the private sector economy earlier this month and the country’s state planner also unveiled measures to spur private investment in infrastructure sectors.
READ: China eyes support for consumer, private sectors as growth falters
Financial institutions are encouraged to step up credit support for firms in service industries such as wholesale and retail, accommodation, catering, and cultural tourism, the financial regulator said.
Chinese banking sector’s bad loan ratio stood at 1.68 percent at the end of June, down 0.08 percentage points year-on-year, according to the regulator.
Outstanding non-performing loans in the banking sector stood at 4 trillion yuan ($560.09 billion) at the end of June, it added.
($1 = 7.1417 Chinese yuan renminbi)