Xinhua News Agency, Beijing, January 25th (Reporter Wang Zixu) With the new supervision of consumer finance companies, bank credit cards, etc. With the implementation of regulations, the competitive landscape of consumer finance is facing reshaping. Recently, the China Banking and Insurance Regulatory Commission issued a document on the rating and classified supervision of consumer finance companies to further promote the standardized operation of consumer finance companies. At the same time, subject to supervision, Internet lending products such as Huabei and Weiweidai have reduced their quotas. In addition, the management of the upper and lower limits of bank credit card overdraft interest rates has ushered in”relaxation”, and the competitiveness of banks in the consumer finance sector may increase in the future.

Analysis pointed out that consumer finance plays a positive role in promoting consumption and expanding domestic demand. With the extensive participation of commercial banks, consumer finance companies, Internet platforms and other institutions, the consumer credit market will move from a blue ocean to a red ocean. .

Multiple measures to regulate the development of consumer finance

Recently, a number of policies to promote the standardized development of the consumer finance market have been released. The General Office of the China Banking and Insurance Regulatory Commission recently issued the”Notice on Issuing the Measures for the Supervision and Rating of Consumer Finance Companies (for Trial Implementation)”. According to the notice, the regulatory rating of consumer finance companies is scored as 100 points. According to the specific rating scores, it is divided into 1 and 2 (A , B), Level 3 (A, B), Level 4 and Level 5. The larger the value, the greater the institutional risk or problem, and the higher the level of regulatory attention. For consumer finance companies rated at level 5, the supervision intends to order them to submit rescue plans such as mergers, acquisitions, reorganizations, and the introduction of strategic investors, or take over according to law.

The person in charge of a licensed consumer finance company said that the rating of consumer finance companies by regulatory authorities means that consumer finance companies are ushering in the era of classified supervision for the first time, which will help further promote the standardized operation of consumer finance companies. This constitutes a major benefit for its healthy and sustainable development.

The regulatory authorities are also continuing to strengthen and improve the supervision of Internet consumer credit. The Banking and Insurance Regulatory Commission’s Consumer Rights and Interests Protection Bureau recently issued a risk warning, focusing on”calling names” of outstanding common problems in current online platform lending products, including information Improper disclosure, excessive packaging marketing, excessive collection and abuse of customer information, etc. Prior to this, the China Banking and Insurance Regulatory Commission also warned against risks such as credit card lending and financial live marketing.

“A series of regulatory policies and measures recently released will help regulate the order of the consumer financial market, prevent and control various financial risks, protect the legitimate rights and interests of consumers, and better promote the healthy and sustainable development of the industry.” Dong Ximiao Say.

At the same time, the development of bank consumer credit also ushered in heavy benefits. The”Notice of the People’s Bank of China on Promoting the Market-oriented Reform of Credit Card Overdraft Interest Rates” was issued recently, deciding that starting from January 1, 2021, credit card overdraft interest rates will be determined by the issuer and cardholders through independent negotiation and cancel the upper and lower limits of credit card overdraft interest rates Management (that is, the upper limit is five ten thousandths of the daily interest rate, and the lower limit is 0.7 times the daily interest rate five ten thousandths). The industry pointed out that the”relaxation” of credit card interest rates will enhance the competitiveness of credit card business in the field of credit consumption.

Consumer finance market pattern or reshaping

With the release of new consumer finance regulations, the market competition pattern is also facing reshaping. In the future, banks may improve their competitiveness in the field of credit consumption.

“For many years, the credit card business has been competing with other credit consumer products. Although the overdraft interest rate is the same, it has been at a disadvantage due to the lack of competitive advantages in many aspects such as policy compliance, transaction scenarios, and business processes. The issuance of this notice is an important measure for the credit card business to regain its mainstream status in the market.” said Dong Zheng, a senior credit card expert.

The reporter learned that the daily interest rates of current Internet lending products such as Huabei, Baitiao, and Bibai are mostly between 0.05%and 0.035%. The cancellation of the upper and lower limits of the credit card overdraft interest rate of 0.05%-0.035%/day can be seen as a strong untie of the credit card business, which completely releases the constraints of credit card overdraft interest rates, which is conducive to the battle between bank credit cards and other Internet credit consumer products Occupies a favorable position.

At the same time, Internet credit products such as Huabei and Weiweidai have recently reduced their credit lines. Recently, some users said that their Huabei quota has been reduced, and many users reported that the quota has been reduced to below 3,000 yuan. In this regard, Huabei confirmed that it is currently adjusting the quotas of some young users and advocating more rational consumption habits. WeBank recently stated that according to the relevant provisions of the Interim Measures for the Administration of Internet Loans of Commercial Banks, in order to promote the stable and healthy development of business, WeBank The maximum credit limit for personal consumption loans for bank micro-finance products was adjusted from 300,000 yuan to 200,000 yuan.

Experts said that with the”relaxation” of credit card overdraft interest rate pricing and the reduction in credit lines of Internet credit products such as Huabei, the future competitiveness of credit card business in the field of credit consumption may gradually increase. However, this also requires Card-issuing banks continue to improve their business strength and product competitiveness.

Supervisors warn consumers of over-indebtedness

The industry pointed out that the consumer finance sector has a relatively broad market space, with commercial banks, consumer finance companies, and Internet With the extensive participation of platforms and other institutions in the competition, the consumer credit market will move from the blue ocean to the red ocean. However, consumers also need to be alert to the risks associated with consumer financial products to avoid excessive debt.

The 2021 Central Bank Work Conference pointed out that it will continue to prevent and resolve financial risks. It mentioned that excessive marketing of financial products is strictly prohibited to induce excessive debt. The China Banking Regulatory Commission’s risk warning also pointed out that in order to acquire a large number of customers, some online platforms use various online consumption scenarios to over-market financial products such as loans or credit card overdrafts to induce excessive consumption. Be wary of the hidden risks or traps behind excessive borrowing marketing.

Guo Wuping, director of the Consumer Protection Bureau of the China Banking and Insurance Regulatory Commission, wrote a few days ago that the chaos of financial technology companies infringing on consumer rights is more worthy of attention. Compared with licensed financial institutions, fintech companies rely more on shopping, transaction, logistics and other behavioral data, rely more on the borrower’s consumption and repayment willingness, and lack an effective assessment of the repayment ability, which often results in excessive credit, and the situation Inducing co-stimulation of advanced consumption has caused some low-income groups and young people to fall into debt traps, which will eventually harm consumers’ rights and even bring harm to families and society.

Experts pointed out that Internet lending products are an important part of consumer financial products. Supervision warns of risks, but the policy of moderate development of consumer finance will not change in general. More policy measures should be introduced on the premise of prudential supervision. Support the healthy development of Internet consumer finance regulations.

Mo Xiugen, executive director and research director of the Institute of Inclusive Finance of Renmin University of China, said that the main reason for the emergence of risks such as long-term borrowing is that credit information cannot be shared well. The current credit investigation system in my country is mainly about bank lending and lending information on some Internet platforms, which is not very sound. In the next step, the regulatory authorities should focus on solving the problems of collecting and sharing lending information on various platforms, so that lenders can have a more comprehensive understanding of customers’ lending and credit information.

In addition to complementing the shortcomings of the system and improving the construction of the credit investigation mechanism, Mo Xiugen also pointed out that the deeper reason for the problem of excessive debt is the lack of financial literacy of customers and the failure to make a balanced plan for revenue and expenditure. For this reason, Individual financial literacy of residents should be improved, and financial literacy education should be included in the scope of national basic education. (End)