DBS secures China central bank funding for lending to green projects

PBOC will provide financial institutions with funds equal to 60% of a loan's principal.

DBS China has been chosen by China’s central bank to receive low-cost funding for lending to sustainable development projects.

Under the Carbon Emission Reduction Facility, the People’s Bank of China (PBOC) will extend low-cost funding to DBS China. DBS China will then use the funding to offer low-cost loans to fund sustainable development projects. Key sectors targeted include clean energy, energy saving, environmental protection, and carbon emission reduction technologies.

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PBOC will provide financial institutions with funds equal to 60% of a loan's principal at an annual interest rate of 1.75%. It will also guide financial institutions to provide carbon emission reduction loans to enterprises in key areas of decarbonisation, on the premise of independent decision-making and risk-taking. 

As of September 2022, loans valued at over RMB400b have reportedly been made by PBOC via the facility.