Ou Wenhan (2nd L, back), an official with the Ministry of Finance, attends a press conference held by the State Council Information Office in Beijing, capital of China, April 21, 2023. (Photo by Liu Jian/Xinhua)

China will exempt 2.325 billion yuan (about 338 million U.S. dollars) of interest on state-subsidized student loans as part of an effort to ease financial and job-hunting pressures on college graduates, an official said Friday.

Repayments of student loan principal totaling around 5.5 billion yuan can be deferred, Ou Wenhan, an official with the Ministry of Finance told a press conference. About 4 million graduates will benefit from these measures, Ou added.

The estimates followed a Wednesday circular on the measures, which were introduced in 2022 and extended into this year.

College students who are graduating in 2023 or earlier are exempt from paying interest for this year. They can also defer this year's repayments of the principal for one year without penalties or compound interest, read the circular jointly released by the ministry and three other government organs.

In order to help financially disadvantaged students complete their college education, China lowered the interest rate on loans to 30 basis points below the benchmark loan prime rate in 2020, and raised the loan limits by 4,000 yuan annually from 2021, according to Ou.

A record number of 11.58 million college graduates this year are currently seeking employment, official data shows.