Residential buildings pictured in Changsha, Central China's Hunan province on May 9, 2021. [Photo/VCG]

China will cut the interest rates on individual housing provident fund loans by 25 basis points to ease the burdens of homebuyers, while stabilizing the real estate market, PBOC Governor Pan Gongsheng said on Wednesday.

For first-home buyers with loan terms over five years, the rate will be lowered from 2.85 percent to 2.6 percent, while rates for other maturities will be adjusted accordingly, Pan said at a news conference, adding that the move is expected to save homebuyers' interest payments by more than 20 billion yuan ($27.7 billion) per year.

Pan added that the central bank will lower the interest rates on structural monetary policy tools by 25 basis points.

This includes the rates on various targeted instruments such as the relending facility for agriculture and small businesses and the Pledged Supplementary Lending, a policy tool through which the central bank provides funding to policy banks.