China has subsidized over 20 million college students from families with financial problems by granting them soft loans totaling over 400 billion yuan ($56 billion), according to the Ministry of Education.

The nation began granting State-level student loans in 1999 and during the initial phase of the policy implementation, full-time vocational, undergraduate students and postgraduate students could apply for a loan of 6,000 yuan per person per year.

The credit line was lifted to 12,000 yuan for vocational and undergraduate students and 16,000 yuan for postgraduate students from 2021.

The annual interest on student loans is pegged to the benchmark interest rate released by the People's Bank of China, around 3 to 4 percent.

The nation shoulders the loan interest for applicants during their schooling, while the applicants pay the principal and interest by themselves after finishing their college study within the prescribed time period — no more than 22 years after their college graduation.

The funded students have a grace period of at most five years after their graduation, during which they are allowed to defer the payment of the principal and only pay the loan interest.

The central government decided to exempt the year's loan interest payment for college graduates last year to help relieve their financial burden from COVID-19, under which 3.79 million graduates and payable loan interest of 1.95 billion yuan were exempted, according to figures from the Ministry of Finance.

The central government will continue to exempt the graduates' payable loan interest this year with the amount projected to reach 2.32 billion yuan.

According to the loan payment regulation, graduates subsidized by student loans who have lost their ability to work or earn very low income, whose families have experienced severe natural disasters or have family members suffering from severe diseases can apply for financial assistance from the financial institutes and government bodies that approved their loans. Their loans will be paid by the local government and their universities after the difficulties are verified.