The Structure and Evolution of China’s Green Finance Policy Instruments (Economics & Business Management)

Summary

• China's published outstanding green loan balance reached RMB 44.8 trillion at end-2025.p.4
• The share of green loans in total bank loans increased from 6.7% at end-2020 to 16.2% at end-2025.p.4
• Climate Bonds Initiative-aligned annual green bond issuance in China reached $87.8 billion in 2022.p.5
• Cumulative CBI-aligned green bond issuance in China reached about RMB 3.2 trillion by end-2024.p.5

Key insights

1. China's green finance policy system covers five main categories: green credit, green bonds, green insurance, green funds, and carbon finance.p.3
2. The central bank's carbon reduction support facility acts as both carbon finance and green credit by providing low-cost bank funding.p.3
3. Revisions to the statistical definition of green loans in 2025 mean end-2025 data is not strictly comparable with earlier years.p.4
4. Outstanding green loan balances maintained double-digit year-on-year growth every year from 2021 through 2025.p.5
5. Policy focus evolved from general framework building (2016–2020) to detailed project catalogues, target facilities, and bank evaluation schemes.p.6
6. Government direction sets market boundaries via national project catalogues while institutional evaluation dictates bank green business targets.p.7