•A game model among governments, banks and PV companies is built.•Empirical analysis for the impact of subsidies and loans on PV company.•The “Credit Limitation Policy” is a quasi-natural experiment to test loan access.•Loan limitation undermines PV companies' performance.•Governments' subsidies have little impact on company performance. China’s Photovoltaic (PV) industry plays a critical role in the global PV industry. Between 2013 and 2015, Chinese PV companies were restricted in their access to debt financing. However, to date there has been a lack of studies investigating this “Credit Restriction Policy“. This paper innovatively builds a dynamic game model to analyze the behavior of governments, banks and the PV companies in the process of financing PV companies and is the first attempt to use the quasi-natural experiment in the PV industry to investigate the impact of loan restriction on firm performance. The game analysis shows that both the governments' support behavior and companies' loan decisions have nothing to do with the cost of governments' support to companies. Using the panel data for China's listed PV companies from 2007 to 2017, the empirical results reveal that restricting access to bank loan undermines PV companies’ performance, but government subsidies have little impact on the operating performance of PV companies. The results suggest that while restriction of financial access has negative impact on PV companies, government’s administrative intervention is not desirable and instead government should improve the institutions for bank lending.