Recently, the General Office of the Communist Party of China Central Committee and the General Office of the State Council issued the "Special Action Plan for Boosting Consumption" (hereinafter referred to as the "Plan"). Last year's Central Economic Work Conference and this year's Government Work Report listed "vigorously boosting consumption, improving investment efficiency, and expanding domestic demand in all aspects" as the top priority of various key tasks, and clearly proposed the implementation of special actions to boost consumption. Policy integration and collaborative efforts to promote consumption are the ultimate demand, which is not only related to economic development, but also to the people's aspirations for a better life. In 2024, China's economy achieved considerable growth, but in the medium to long term, we need to implement structural reform measures in order to combine short-term policies with promoting long-term growth. The problem of consumption structure has existed for a long time, so comprehensive structural reform measures are needed. "Chen Yuyu, director of the Institute of Economic Policy at Peking University, believes that the" Plan "provides a strong stimulus for the expansion of domestic demand and sets a good start for a more sustainable and balanced growth in the medium to long term in the future. Che Shiyi, head of the Credit Market Department of the People's Bank of China, said that the People's Bank of China will earnestly implement the requirements of the Plan, study and issue special documents on financial support to expand consumption together with financial supervision and other departments, strengthen the coordination of financial and fiscal policies and industrial policies, and guide financial institutions to actively meet the diversified capital needs of various entities from both sides of consumption supply and demand. To implement a moderately loose monetary policy and create a favorable financial environment for expanding consumption. Che Shiyi said that the People's Bank of China will adjust and optimize its policy intensity and pace according to the requirements of the central government to implement more active and proactive macro policies, based on the domestic and international economic and financial situation and the operation of the financial market. By comprehensively utilizing various monetary policy tools such as reserve requirements, refinancing and rediscounting, and open market operations, we aim to maintain sufficient liquidity. Research the creation of new structural monetary policy tools and increase low-cost funding support in key areas of consumption. In 2025, a moderately loose monetary policy will work in conjunction with other macro policies, becoming more forward-looking, targeted, and effective, and shifting the focus of support services from investment to consumption, creating a more suitable monetary and financial environment to boost consumption Dong Ximiao, Chief Researcher of Zhaopin and Deputy Director of Shanghai Finance and Development Laboratory, believes that this is an inevitable choice after the driving force of China's economic growth changes. It will further promote the transformation and upgrading of the economic structure and the growth of new driving forces, laying the foundation for economic and social development and the improvement of people's livelihood. We also need to strike a good combination of consumer policies to support the improvement of consumer supply quality and benefit the people. Che Shiyi stated that the People's Bank of China will strengthen departmental coordination and cooperation, increase financial support for key consumer sectors such as culture and tourism, elderly care, and sports, and promote the development and growth of consumer related industries and enterprises. Strengthen the construction of specialized financial services such as consumer infrastructure and commercial circulation system, and promote the improvement of consumer supply quality and energy efficiency. Promote the joint efforts of financial and fiscal policies such as interest subsidies, tax reductions, and fee reductions, support the increase of high-quality consumer products and service supply, and enhance the consumer satisfaction of the people. The plan proposes to optimize products to meet consumer demands, encouraging financial institutions to increase their investment in personal consumer loans under the premise of controllable risks. Che Shiyi stated that the People's Bank of China will optimize its financial products and services to meet differentiated consumer demands. Dong Ximiao believes that in this context, financial institutions such as commercial banks and consumer finance companies should increase their investment in consumer loans to better promote consumption and expand domestic demand. We can further enrich the usage scenarios of consumer credit around key areas such as automobiles, housing, home appliances, and catering, especially by promoting the organic integration of trade in measures for consumer goods with consumer credit products. The reporter learned from Agricultural Bank of China that the bank is closely following the national policy to boost consumption and is making greater efforts to promote "expanding domestic demand and promoting consumption". Around key areas such as automobiles, home appliances, home decoration, elderly care, cultural tourism, and new consumption, we will build a three in one service system of "fast policy coordination, deep scene integration, and strong technological empowerment", optimize service measures, and continuously increase the investment in personal consumption loans. As of March 17th, the balance of personal consumer loans, including credit cards, of Agricultural Bank of China was 133 trillion yuan, with an annual increase of 27 billion yuan, ranking first in the industry. Since the beginning of this year, Industrial and Commercial Bank of China has mobilized resources across the bank to launch a special campaign to boost consumption, and has continued to increase credit allocation. As of the end of February 2025, the cumulative historical investment in personal consumption loans has exceeded 1.7 trillion yuan, with loan balances increasing by 78.1 billion yuan compared to the same period last year and 10.8 billion yuan compared to the beginning of the year The relevant person in charge of the Personal Credit Business Department of Industrial and Commercial Bank of China said that in the future, we will conduct in-depth research on the actual needs, behavioral characteristics, and changing trends of different consumers. Using specific consumption scenarios as entry points, we will implement classified policies, coordinate and linkage, and continuously increase the supply of consumer credit and improve the quality of financial services through digital and intelligent technology. China CITIC Bank has also actively responded to the policy orientation of boosting consumption, deeply cultivating large-scale consumption scenarios, and helping to upgrade consumption in bulk consumption fields such as new energy vehicles and home decoration through innovative financial products and services. The relevant person in charge of China CITIC Bank introduced that in the future, it will strengthen technological empowerment, take consumer demand as the guide, optimize loan processes through digital means, continuously enhance the accessibility and convenience of consumer finance products, provide customers with more efficient and convenient financial experiences, and help upgrade consumption through financial product and service innovation. We also need to broaden the sources of funding for financial institutions and expand the supply of funds in the consumer sector Che Shiyi stated that the People's Bank of China will actively support financial institutions in issuing financial bonds for use in the consumer sector. Support financial institutions to carry out asset securitization business based on consumer loans and car loans, and increase investment in car loans and consumer loans. Expand the variety of over-the-counter bond investments and broaden the channels for residents' property income. Strengthening risk control and holding the bottom line, while vigorously developing consumer loan business, how banking and financial institutions can prevent excessive borrowing, fund misappropriation, and rising non-performing loan rates has also become a focus of attention in the industry. The Plan mentions in the aspect of "strengthening credit support" that the amount, term, and interest rate of consumer loans should be reasonably set. Dong Ximiao believes that some banks, in order to expand their market share, hope to attract more customers through lower interest rates, and therefore actively reduce consumer loan interest rates. Overall, the reduction of consumer loan interest rates helps to lower the interest expenses of financial consumers, enhance their willingness to apply for consumer loans, and thus fully leverage the positive role of consumer finance. Some banks offer ultra-low interest consumer loans, usually targeting high-quality customer groups with high requirements for customer occupation, income, etc., and overall controllable risks. However, the low interest rate of personal consumption loans may also have some negative effects Dong Ximiao analyzed that firstly, it may cause consumers to have a "interest rate illusion" and blindly apply regardless of their actual situation, thereby increasing their personal debt burden; Secondly, consumer loans may be misused or diverted, leading to the illegal flow of credit funds into capital markets, wealth management markets, etc. Wang Pengbo, Chief Analyst of the Financial Industry at Broadcom Consulting, believes that moderate monetary easing has led to a decline in interest rates and a reduction in bank funding costs, providing a foundation for lowering consumer loan interest rates. Banks attract customers by lowering interest rates and increasing credit limits, which helps alleviate the pressure on consumers' interest expenses, promote consumption, and expand domestic demand. However, in a low interest rate environment, some banks may relax their customer screening criteria, leading to the accumulation of credit risk. We cannot just let it go, we should provide differentiated loan limits based on the customer's risk tolerance and credit status. The deadline should also be more flexible, with flexible settings for different scenarios and industries to ensure that it matches the customer's repayment ability Wang Pengbo believes that banks should strengthen their risk control level, enhance customer credit evaluation, conduct full lifecycle supervision, strictly review loan purposes, and avoid excessive lending. In addition, one-stop financial services should also be explored, such as differentiated pricing and innovative products, to reduce costs and increase efficiency while getting rid of dependence on a single interest rate. For consumers, applying for consumer loans should be handled at financial institutions such as commercial banks and consumer finance companies. They should not apply arbitrarily just because of low interest rates. Applying for consumer loans should be based on personal and family consumption needs, and should be done within their means to control their personal debt burden within a reasonable level. Dong Ximiao stated that financial institutions should further strengthen consumer rights protection, explore the use of financial technology in consumer rights protection work, accelerate the construction of a "technology+consumer protection" system, empower consumer protection work through digital technology, drive consumer protection mode innovation, and improve the efficiency of consumer rights protection work. (New Society)