The China Banking and Insurance Regulatory Commission issued the “Notice on Further Promoting the Standardized and Healthy Development of Credit Card Business (Draft for Comment)” and
proposed to require banks to set a ceiling on the total amount of credit cards for a single customer
In recent years, the rapid development of credit card business in my country's banking financial institutions has played an important role in facilitating payment and daily consumption by the masses.
However, in the recent period, some banks’ credit card business operations have been extensive, with weak service awareness, inadequate risk control, and infringements on the legitimate rights and interests of customers.
On December 16, the China Banking and Insurance Regulatory Commission issued the "Notice on Further Promoting the Standardized and Healthy Development of Credit Card Business (Draft for Comment)" (hereinafter referred to as the "Notice") to regulate credit card business operations and implement banking financial institutions and their cooperative institutions Manage responsibility, improve the quality and efficiency of credit card services, and protect the legitimate rights and interests of financial consumers.
Improve management transparency
Promote a reasonable decline in credit card interest rates
Some banks have unclear disclosure of interest and fee levels, unilaterally promoting low interest rates and low rates, charging interest in disguise in the name of handling fees, obscuring actual usage costs, unreasonably setting a low or no starting point for bill installment, without the customer's initiative Confirming the implementation of automatic installment and other issues has increased the difficulty for customers to accurately understand and judge the cost of credit card use, and even increased the burden of interest on customers.
The "Notice" requires banks to effectively improve the standardization and transparency of credit card interest fee management, and show that the cost of use of funds for instalment business is uniformly used in the form of interest.
The total amount of interest and fees borne by defaulted or overdue customers shall not exceed their corresponding principal.
The minimum starting amount and maximum amount of instalment business should be clarified, and the interest burden of customers should not be increased by inducing excessive use of instalments.
At the same time, it is clearly required that banks must continue to take effective measures to resolutely promote a reasonable decline in credit card interest rates.
Cash advance business application installment
The repayment amount shall not exceed 50,000 yuan
The "Notice" stipulates that banking financial institutions shall not re-apply installment for the balance of funds that have already been installed, except for the personalized installment agreement stipulated in the "Commercial Bank Credit Card Business Supervision and Administration Measures."
It is not allowed to provide minimum repayment service for instalment business.
It is not allowed to only provide or check the option of charging full installment interest at a time.
Banking financial institutions shall prudently set the credit card installment overdraft amount and period, and clarify the minimum starting amount and maximum amount of installment business.
The term of installment business shall not exceed 5 years.
If the customer really needs to apply for instalment repayment for the cash advance business, the amount shall not exceed RMB 50,000 or the equivalent freely convertible currency, and the period shall not exceed 2 years.
Monitor new card-issuing customers applying for credit cards at other institutions
Corresponding deductions should be implemented
Some banks’ credit card credit control is not prudent and cannot rigorously assess the credit status of customers, causing problems such as excessive credit, increasing operating risks, and unreasonably pushing up customer leverage.
Regarding this issue, the "Notice" strengthened the control of excessive credit card credit.
The "Notice" requires that banking financial institutions should reasonably set the upper limit of the total credit line of a single customer's credit card based on the customer's credit status, income status, financial status, etc., and include the customer in the unified management of all credit lines of the institution.
Within the total credit line of the credit card, the credit line of the cash advance business shall not exceed the credit line of the non-cash advance business.
The bank shall conduct full due diligence on a single customer, and implement a consolidated management of all credit card credit lines of other institutions that the customer knows about.
During the credit approval and increase of the credit line (including temporary increase), the total credit line of the customer’s credit card should be deducted from the credit line of the customer’s credit card. Circumstances, implement corresponding deductions.
The "Notice" requires that banking financial institutions shall implement strict and prudent dynamic management of credit card credit lines, and re-evaluate, measure and determine the credit line of credit card customers at least once a year.
For customers whose risk status has deteriorated significantly, measures such as reducing credit lines should be taken in a timely manner.
Customers who have increased their credit limit shall re-approve the credit approval, and the credit limit shall not be increased without the customer’s consent.
Banking financial institutions shall strictly set the approval authority for credit line increase, and reasonably set the range, frequency, time interval, and validity period of temporary credit line increase.
The proportion of long-term sleep credit cards must not exceed 20%
The number of cards issued through a single cooperative institution cannot exceed 25%
Some banks have unscientific business concepts, blindly pursuing economies of scale and market share, and protruding card issuance indiscriminately and repeatedly, leading to problems such as disorderly competition and waste of resources.
The "Notice" urged banks to change the extensive development model of credit cards.
The "Notice" requires banks not to use the number of cards issued and the number of customers as a single or main evaluation indicator, and the proportion of long-term sleep credit cards should not exceed 20%. Banks that still exceed this proportion after the rectification are not allowed to issue new cards.
In the future, the China Banking and Insurance Regulatory Commission will also dynamically lower the limit standards for the proportion of long-term sleep credit cards, and continue to urge the industry to reduce the proportion of sleep cards to a lower level.
Some banks have problems such as irregular credit card business cooperation, inadequate management and control, and unclear boundaries between the rights and responsibilities of the cooperating parties.
The "Notice" requires banks to handle the core business of credit cards through self-operated online platforms, implement a unified list management system for cooperative institutions, and clearly stipulate the rights and responsibilities of both parties.
The card issuance volume and credit balance of a bank through a single cooperative institution must meet the concentration index limit. The total number of cards issued shall not exceed 25% of the total number of credit cards issued by the institution, and the total credit balance shall not exceed 15% of the total credit balance of the institution.
Text/Reporter Cheng Jie
pay attention to
The total amount of interest and fees charged to defaulting customers shall not exceed the principal overdraft incurred
At present, consumer complaints in the credit card field mainly focus on irregular marketing and publicity, poor complaints, and improper collection of customer information.
In terms of strengthening the protection of consumers' rights and interests, the "Notice" requires banks not to conduct fraudulent and false propaganda, compulsory bundling sales, and must fully disclose card risks, complaint channels and unbinding procedures, etc., and strengthen customer data security management.
Banking financial institutions should scientifically determine the level of credit card interest rates, improve service quality and efficiency, and continue to take effective measures to resolutely promote a reasonable decline in credit card interest rates.
Except for cash withdrawals, the total amount of interest and fees collected by banking financial institutions from customers who have breached contracts or overdue payments shall not exceed their corresponding principal overdrafts incurred.
Banking financial institutions shall strictly implement data security and other relevant laws and regulations and relevant provisions on credit management, and shall not cooperate with institutions that conduct data processing in violation of laws and regulations.