Chongqing- Financial institutions set headquarters in Chongqing can enjoy a reward of 100 million yuan  (about 15.8 million U.S. dollars) maximum, an incentive policy announced by the municipal government recently. As a solid response to the national plan to establish the Chengdu-Chongqing financial court, which aims to support the construction of the western financial center in the Chengdu-Chongqing Economic Circle, Chongqing has released aggressive stimulus policies to attract more financial institutions to set headquarters in Chongqing.

On March 27, Chongqing Municipal Finance Bureau and Chongqing Local Financial Supervision and Administration Bureau solicited public comment on the Management Methods for Rewarding Financial Institutions Settled in Chongqing (Exposure Draft). As per the Methods, financial institutions set headquarters in Chongqing can enjoy a reward of 100 million yuan  (about 15.8 million U.S. dollars) maximum.

Reward standards

The rewards will be jointly provided by the financial authorities of the municipality and the district (county) where the financial institution is located on a proportional basis. Notably, if the financial institution is located in Chongqing's main urban area, the proportion will be 5:5.

If the financial institution is located in the town clusters of the Three Gorges Reservoir area in northeast Chongqing and the Wuling mountainous area in southeast Chongqing, the municipal financial authority will provide more support and the proportion will be 7:3.

Headquarters of financial institutions can enjoy a one-off reward of 100 million yuan maximum that is calculated on 1% of their paid-in capital.

Functional headquarters of financial institutions can enjoy a one-off reward of 10 million yuan maximum.

For these two types, factors such as economic contributions and social influence will be considered.

Regional headquarters and municipal organizations of banks can enjoy a one-off reward of 3 million yuan (about 470,000 U.S. dollars).

Regional headquarters and municipal organizations of financial institutions except banks can enjoy a one-off reward of 500,000 yuan (about 78741.4 U.S. dollars).

Local financial organizations that meet requirements and with their registered capital exceeding 1 billion yuan (about 160 million U.S. dollars) can enjoy a reward of 2 million yuan (about 310,000 U.S. dollars). If their registered capital is between 500 million yuan (about 78.7 million U.S. dollars) (including 500 million yuan) and 1 billion yuan, the reward is 1 million yuan.

It should be noted that the rewarded financial institutions shall operate in Chongqing from the day of enjoying the rewards, and shall not relocate out of Chongqing within five years. Once the relocation happens, the rewards shall be returned in full.

Why introduce the new reward methods

Chongqing's current reward and subsidy policy for financial institutions to be located in Chongqing was launched in 2009. As Chongqing puts forward to develop a financial center in western China and an international financial center in the interior of China, it is necessary to cultivate more headquarters of new-type financial institutions and attract more fintech companies to Chongqing.

Compared with the previous reward and subsidy policy, the Methods has increased the maximum reward from 10 million yuan to 100 million yuan and included new-type financial institutions into the scope to diversify Chongqing's financial business forms.

New-type financial institutions here include equity investment, venture capital investment, fin-tech, etc.