China News Service, April 5 (China News Finance Ge Chenggong Hongyu) Recently, car loans have ushered in major adjustments!
The People's Bank of China and the State Administration of Financial Supervision jointly issued a notice stating that the maximum loan disbursement ratio for self-use traditional power vehicles and self-use new energy vehicles will be determined independently by financial institutions.
This means that the loan disbursement ratio for consumer car purchases can reach up to 100%, and "zero down payment" car buying is expected to become a reality.
Data map: Auto show scene. Photo by China News Network reporter Luo Yunfei
The “threshold” for buying a car has been lowered
Before the issuance of this notice, the maximum loan disbursement ratios for self-use traditional power vehicles and self-use new energy vehicles were 80% and 85% respectively.
However, in actual operation, Sino-Singapore Finance has noticed that it is most common for car loans to have a down payment of 30%. Among them, the down payment ratio of car loans from banks is generally around 30%-40%, while the down payment ratio of auto finance loan institutions is lower, with a minimum of 20%.
This adjustment makes the restriction on the proportion of self-use car loans a thing of the past, and the "threshold" for consumers to buy a car has become even lower.
"The above notice is undoubtedly good news for the automobile market." Zhang Xiang, a researcher at the Automotive Industry Innovation Research Center of North China University of Technology and director of the Vodafor Digital Automobile International Cooperation Research Center, told China News Finance that the lower the down payment ratio, the more likely it is to buy a car. The lower the threshold, the more effectively it can increase car sales and stimulate economic development.
Dong Ximiao, chief researcher of China Merchants Union, also analyzed that this will further improve residents’ ability to purchase cars with personal car loans and promote the realization of “zero down payment”.
Car “trade-in” for new is another good thing
In addition to adjusting the car loan ratio, another content in the notice has also triggered a lot of discussion, that is, "appropriately exempting and exempting liquidated damages caused by early settlement of loans during the car trade-in process to better support reasonable car consumption demand."
In the view of industry insiders, this adjustment echoes the recent hot demand for "old-for-new" in the automobile market.
In March this year, the State Council issued the "Action Plan for Promoting Large-Scale Equipment Updates and Trade-in of Consumer Goods," which requires "organizing and carrying out national car trade-in promotions" and "phasing out old cars that meet compulsory scrapping standards in accordance with laws and regulations."
Subsequently, many car companies, including Chery and NIO, launched preferential activities to the market in the name of "trade-in" to stimulate consumers' demand for "exchange cars".
In this context, Zhang Xiang believes that the policy on "early settlement of loan penalties" can eliminate car owners' worries about "trade-in" and encourage consumers to buy new cars.
"China's automobile industry has now transformed from an incremental market to a stock market. The proportion of car owners who buy second cars and additional car owners is greater than the car owners who buy their first car. Reducing the replacement cost for car owners will undoubtedly speed up the sales of new cars. "Zhang Xiang said.
Dong Ximiao also mentioned that the notice will help reduce the burden on residents to buy new cars through "trade-in" and boost residents' willingness and ability to consume cars.
Data map: New energy vehicles. Photo by China News Service reporter Yin Liqin
Relax but also guard against risks
In addition to "lowering the threshold" for car loans and liquidated damages, Dong Ximiao mentioned that another important content of this notice is to address the phenomenon of frequent loan fraud in the field of car loans, requiring the strengthening of full-process management of car loans, and strictly preventing the diversion of loan funds. Use it for other purposes to reduce credit risks that may increase after policy relaxation.
This shows that while relaxing car loan regulations, their supervision and management cannot be ignored.
Zhang Xiang emphasized that financial institutions cannot reduce risk requirements simply to increase loan volume. "While reducing the down payment ratio, financial institutions must also improve risk management and control and do a good job in credit evaluation of loan users. Only users who can meet the credit evaluation conditions can issue loans at a lower ratio." (End)