China's central bank cut the amount of cash that banks must hold as reserves on Wednesday, the first industry-wide cut in more than two and a half years, as it increased efforts to shore up flagging economic growth.

The reserve requirement ratio, or RRR, would be lowered by 50 basis points, the People's Bank of China said. The cut, which takes effect on Thursday, brings the RRR for big banks to 19.5 percent.

The central bank said the RRR would be lowered by an additional 50 basis points for urban and rural commercial banks that lend to small and medium-sized companies.