BEIJING, April 17 (Reuters) - The auto finance arm of China's state-owned automaker FAW Group has launched a loan programme with no down payment, becoming one of the first providers to make such a move since the removal of government-set minimum payments.

The move is intended to "maximally relieve customers' car purchase pressure", FAW said in a statement on Wednesday.

FAW Auto Finance is one of 25 auto finance firms operating in the world's largest auto market, where slowing demand and a price war have vexed both authorities and carmakers.

Earlier in April, China announced changes to car loans to promote auto trade-ins, which scrapped government-set minimum down payments for consumers financing new car purchases.

The lowest payments on personal auto loans for gasoline-engine cars and new energy vehicles (NEVs) will now be determined by financial institutions, with upfront payments as low as zero, said Dong Ximiao, chief researcher at Merchants Union Consumer Finance Company Limited.

Prior to the changes, NEVs were subject to a minimum down payment of 15%, and internal combustion vehicles to a down payment of at least 20%.

The hope is that financing incentives will persuade cautious consumers to spend amid a faltering economy.

Tesla has launched time-limited zero-interest loans for up to five years for its Model 3, Model Y vehicles in China. Volkswagen and Nio have also launched auto financing plans with low interest rates to attract buyers. (Reporting by Qiaoyi Li, Zhang Yan, Ziyi Tang and Brenda Goh; Editing by Mark Potter)