To thoroughly implement the arrangements made at the Central Financial Work Conference, recently, the People’s Bank of China (PBOC), together with the Ministry of Science and Technology, the National Development and Reform Commission, the Ministry of Industry and Information Technology, the National Financial Regulatory Administration, the China Securities Regulatory Commission, and the State Administration of Foreign Exchange, unveiled the Work Plan on Boosting the Development of Technology Finance (hereinafter referred to as the Work Plan).

The Work Plan encourages financial institutions and financial markets to comprehensively enhance their capacity, intensity and effects in providing financial support for sci-tech innovation by improving fundamental institutional arrangements and strengthening incentive and constraint mechanisms. The Work Plan aims to provide financial services covering the whole chain and full cycle of the sci-tech innovation activities conducted by various innovation entities and to take targeted measures to support major national science and technology programs, cultivation and development of tech-based enterprises, strategic emerging industries, industries of the future, upgrading and transformation of traditional industries, and construction of national and regional sci-tech innovation highlands.

The Work Plan puts forward a series of targeted initiatives to foster a financial market ecology that facilitates sci-tech innovation. Specifically, the financial sector will strengthen its capacity building for professional financial services in an all-round manner and improve its internal systems such as performance appraisal and the mechanism ensuring that those who have fulfilled their duties shall not be held accountable, and banking financial institutions will be supported in building an exclusive organizational structure and risk control mechanism for technology finance.  The Work Plan proposes building green channels for tech-based enterprises to issue bonds, and supporting tech firms in bond financing in terms of financing connection, credit enhancement and credit rating. The functions of stock, the New Third Board and regional equity markets to serve sci-tech innovation will be strengthened, and the policy support for cross-border financing of tech-based enterprises will be intensified. With small and medium-sized sci-tech enterprises as the focus of support, credit and insurance products that adapt to the characteristics of tech-based enterprises in their start-up or growth stage will be improved, pilot innovation in the regional equity market will be further advanced, and the sources and exit channels of venture capital funds will be broadened. In addition, the Work Plan is formulated to build a technology finance ecosystem, encourage local governments across the country to form technology finance alliances, support exchanges and cooperation among various financial institutions and technology intermediary service organizations, and provide tech-based enterprises with diversified financial services encompassing angel investment, venture capital, private equity investment, bank loans, and financing on the capital market.

The Work Plan is designed to strengthen relevant basic systems and mechanisms centering on the entire process of rendering financial services for sci-tech innovation. It proposes to optimize incentive and guidance policy systems and to improve such policy tools as central bank lending for sci-tech innovation and technological transformation, central bank lending to support micro and small businesses, and special financial bonds for sci-tech innovation. It also proposes to establish a mechanism for assessing the effectiveness of technological financial services so as to fully inspire the enthusiasm of financial institutions. The Work Plan also emphasizes the need to establish sound standard systems and statistics systems for technology finance, and improve supporting mechanisms for regular investment and financing connections, information sharing, innovation pilots, and risk sharing and management, so that more targeted and sustainable financial support can be ensured.

Moving forward, the PBOC will earnestly implement the decisions and arrangements of the Central Financial Work Conference. It will establish a work linkage mechanism with relevant departments, strengthen information sharing and policy coordination, and carry out special actions to enhance technology finance service capabilities. Additionally, it will build a platform for experience exchange and discussion, promote the implementation of measures stipulated in the Work Plan, and thus make every effort to boost the development of technology finance. It will also guide financial capitals to invest in startups at their early stages, to invest in small businesses and for long term, and to invest in key & core technology, thus helping realize greater self-reliance and self-improvement in science and technology with high-quality technology finance services.