In Depth: Will China’s Push for Banks to Fuel Tech Growth Pay Off?

China has expanded an equity investment pilot program that provides bank funding for tech companies for the third time in six months, as the government intensifies efforts to support innovation and new quality productive forces — a concept put forward by President Xi Jinping in 2023 to focus on advanced technologies.

The aim is to channel more money into funds that invest in small, fast-growing technology companies. The program could become an important source of capital for state-owned investment entities, especially local government guidance funds (LGGFs), investment vehicles run by local authorities, many of whom are struggling to find cash.