AS the fallout of COVID-19 continues to weigh on the world’s second-largest economy, China’s banking sector has ratcheted up support measures to boost the economy, channeling funds to where they are needed the most.

China’s market entities, totaling 158 million as of the end of last month and major job creators for the economy, have been under greater strains amid economic pressure at home and mounting challenges abroad.

Banks are encouraged to defer, within this year, principal and interest repayments on loans made to micro, small and medium-sized enterprises and self-employed households, truck loans, and home loans and consumer loans owed by individuals facing temporary difficulties, according to the State Council.

Official data showed that outstanding loans to small and micro businesses nationwide stood at 53.54 trillion yuan (US$8 trillion) as of the end of April, of which inclusive loans to small and micro firms reached 20.5 trillion yuan, up 21.64% from a year ago.

As part of efforts to ease the burden on businesses, China has also adopted value-added tax (VAT) credit refunds, which have seen solid implementation so far.

In the COVID-hit metropolis Shanghai, for instance, the People’s Bank of China Shanghai office has issued a guideline, requiring stronger coordination across fiscal and taxation organs to ensure that market entities get their share of VAT credit refunds without impediments and delays.

As of May 29, VAT credit refunds in the city reached 45 billion yuan and benefited over 60,000 firms, data from the central bank showed.

On top of relief measures, banks are also on the move to bolster key areas of growth, with proactive steps taken in sectors such as manufacturing and infrastructure.(Xinhua)