If you work for yourself instead of joining an employer, look first at a startup guarantee loan for the startup money: up to 300000 yuan for an individual, with public finance covering half the interest

If you are in a priority group such as college graduates, veterans, or unemployed people, and you are borrowing to get started, look at this loan with a fiscal interest subsidy first. An individual can borrow up to 300000 yuan, for at most 3 years, and public finance pays half the interest. When you apply, you and your spouse cannot have another loan in your names. A home loan, a car loan, a student loan, and a consumer loan of 50000 yuan or less do not count.

Cost

Asking costs nothing. Go once to the human resources and social security department for an eligibility review, then complete the procedure once at the guarantee agency and once at the handling bank (the bank that makes the loan). The hard part is that borrowed money still has to be repaid.

Benefit

The conditions for an individual application are in Article 6 of the Measures for the Administration of Special Funds for Inclusive Finance Development («财金» [2023] No. 75). The first condition is belonging to a priority employment group. The document lists registered urban unemployed people, people with difficulty finding work (including people with disabilities), veterans, and people who have completed a prison sentence. It also lists college graduates (including college-graduate village officials and students who have returned from study abroad), and workers and unemployed people from enterprises cutting overcapacity. It also lists migrant workers returning home to start a business, online merchants, people who have left poverty, and rural residents starting a business on their own. The second condition is having no other loan in your name: "Apart from student loans, small credit for people who have left poverty, housing loans, car loans, and small consumer loans of 50000 yuan or less (including credit-card spending), when the applicant submits the application for a startup guarantee loan, the applicant and the applicant's spouse have no other loan." Article 9: "For a startup guarantee loan that meets the conditions, the finance department gives a fiscal interest subsidy of 50% of the actual interest rate on the loan. For a startup guarantee loan that is extended or overdue, the finance department in principle gives no interest subsidy." The subsidy means public finance pays half the interest for you. An extension is pushing the date back after it falls due. Overdue is failing to repay on time. In both of those cases, public finance no longer pays. Article 10: for an individual startup guarantee loan of 100000 yuan or less that is included, counter-guarantee is in principle cancelled. You do not have to find someone else, or put up property, as security for the guarantee agency. Article 11: an individual startup guarantee loan included in the award-and-subsidy support "does not exceed 300000 yuan, and the loan term does not exceed 3 years." A partnership may be raised appropriately, up to 110% of the sum of the individual caps. The interest-rate cap on loans supported by the award-and-subsidy program is in tiers: LPR+50 BPs in the eastern region, LPR+150 BPs in the central and western regions, and LPR+250 BPs in areas that have left poverty. LPR is the loan prime rate quoted by banks. BPs are the unit used to measure the interest rate. The more that is added, the higher the interest. A person who "repays actively, is strong at bringing other people into work, and has a good business project" may apply again when the term ends, up to 3 times in total. Article 8: the applicant first applies to the local human resources and social security department for an eligibility review, then submits the application to the guarantee agency and the handling bank. Article 12: with the agreement of the provincial people's government, localities may widen the scope of support, raise the cap, and raise the subsidy ratio (nationwide).

Notes

Public finance paying half the interest does not change the fact that borrowed money has to be repaid. The position in section 12, item 1 of this book has not changed: start a business only with money you can afford to lose, do not touch the family's base, do not sign a personal guarantee for a company loan, and a spouse should not sign along. If you have already decided to borrow, this policy loan is the lowest-interest tier. Do not touch consumer loans or private lending. The cap and the scope can be raised by each province. How much is actually approved follows what the local human resources and social security department says that year. The notice from the 2020 pandemic period, "200000 yuan maximum for an individual," was a temporary document. Use these measures now. Whether to register as a sole proprietor or open a company, licenses, tax filing, and leaving the business are in section 12. Training subsidies, social insurance (社保) subsidies, and employment internships during unemployment are in section 7, item 13 (vocational training subsidies).

Sources · 1

1. 财政部 (2023). 关于印发《普惠金融发展专项资金管理办法》的通知（财金〔2023〕75 号，第六、八、九、十、十一、十二条）. gov.cn/zhengce/zhengceku/202309/content_69036…