● In order to regulate the online microfinance business of microfinance companies and unify the regulatory and operating rules, the China Banking and Insurance Regulatory Commission recently drafted the Interim Measures for the Administration of Online Microfinance Business (Draft for Comment) in conjunction with the People’s Bank of China and other departments. The public solicits opinions
● The supervision of online microfinance business will be in line with bank supervision, which will help prevent the underlying risks caused by cross-regional operations of microfinance companies and improve the previous situation of "supervision depression" in financial supervision in different places
● The increase in entry barriers will result in a slowdown in the growth rate of the entire online microfinance market, which means that it will be more difficult to apply for a national business license for online microfinance companies
□ Our reporter Zhao Li
□ Intern Xing Yiming Guo Yuanqiao
Boots are about to land, and the first domestic regulation on online microfinance is finally here!
In order to standardize the online microfinance business of microfinance companies and unify the regulatory and operating rules, the China Banking and Insurance Regulatory Commission, in conjunction with the People’s Bank of China and other departments, recently drafted the Interim Measures for the Management of Online Microfinance Business (Draft for Comment) (hereinafter referred to as " "Draft for Solicitation of Comments"), now open to the public for comments.
It is understood that the "Draft for Solicitation of Comments" intends to clarify the regulatory body and make detailed regulations on the risk control system, single-account upper limit, information disclosure and other issues in the operation of microfinance companies.
At the same time, several red lines have been drawn, such as restrictions on cross-provincial exhibitions and joint loan contributions of no less than 30%, which have strengthened the protection of financial consumers.
Among them, with regard to "microfinance companies operating network microfinance business across provincial administrative regions, the registered capital will not be less than RMB 5 billion (and a one-time payment)" and network microfinance "in a single joint Regulatory requirements such as the proportion of capital contribution in loans not less than 30% have become the focus of discussion.
Many industry insiders interviewed stated that the release of the "Draft for Comment" means that the supervision of online microfinance business will be in line with bank supervision, which will help prevent the underlying risks caused by microfinance companies' cross-regional operations and improve the previous There are "supervisory depressions" in financial supervision in different places, which raises the overall threshold for online microfinance and has a strong binding force on combating speculation and regulatory arbitrage.
Financial innovation continues to upgrade
Online loan business supervision lags behind
In recent years, as my country's financial innovation continues to upgrade, a large number of Internet companies have been involved in online microfinance in the field of technology.
At the same time, many technology companies have also launched online microfinance business, and even created a wide range of loan products, playing a certain role in solving the problem of inclusive finance.
In the era when Internet lending was far from the rise, residents and small and micro enterprises that were not met by the banking system had huge credit demands, coupled with policy support, and a good social image. Microfinance companies appeared at a rate of more than 1,000 new loans each year.
The source of the business qualification of “online microfinance” can be traced back to the “Guiding Opinions on Promoting the Healthy Development of Internet Finance” issued by ten ministries and commissions in 2015.
The opinion stipulates that online micro-loans refer to micro-loans that Internet companies use the Internet to provide customers with micro-credit companies controlled by them.
In terms of functional positioning, microfinance companies should follow the principle of small and decentralized in issuing online microloans, in line with national industrial and credit policies, and mainly serve key inclusive financial service targets such as small and micro enterprises, farmers, and urban low-income people , Practicing the concept of inclusive finance, supporting the development of the real economy, and giving play to the channel and cost advantages of online microfinance.
With the development of Internet technology, online microfinance companies rely on the advantages of scenarios, traffic, data, and national exhibitions to make Internet loans "repeatingly high" through loan assistance and joint loans.
In order to regulate the development of Internet loans, the industry has been calling for the formulation of a nationwide online microfinance supervision method.
“The biggest problem in the online micro-loan market is compliance and non-compliance. Some joint loan businesses that play a role in supervision are very prominent. At the same time, the rapid expansion of scale is also a concern.” At the Institute of Finance, Chinese Academy of Social Sciences According to Yin Zhentao, director of the Financial Technology Research Office, online micro-loan licenses are also worthy of attention. "Especially the cross-regional business model of online stores across the country, which expands very quickly in scale, which will result in more stakeholder groups, which may be accompanied by The rise of some personal leverage or the emergence of some negative events".
Guo Tianyong, director of the China Banking Research Center of the Central University of Finance and Economics, believes that the Internet-based online microfinance model has a large customer space. It does not need to be limited to a certain area, and the ability of each company to screen and screen customers is different. .
"If you can't identify the customer's credit, you can only use other methods. If you say that a company without technology content, it will adopt some loan sharks or some vicious collections, which can easily lead to some social problems."
Chen Wen, director of the Digital Economy Research Center of the School of Finance, Southwestern University of Finance and Economics, believes that in fact, most of the online small loans approved by a large number of local governments have problems with cross-provincial operations.
For the online microfinance industry, the next three years will need to undergo rectification.
"When a large number of online microloans were established, there was a phenomenon of'regulatory arbitrage'. Companies were registered in some regions such as the central and western regions, and then the business was exhibited nationwide through the Internet. However, the actual business headquarters are in first-tier cities such as Beijing, Shanghai, Guangzhou and Shenzhen or economically developed regions. If the business shrinks to the province or region where the registration is located, there will be almost no market space." Chen Wen said.
Online lending breaks through territorial restrictions
New regulations are about to emerge
It is precisely because the operation of online microfinance has expanded to the whole country on the Internet, breaking through the original territorial restrictions-the financial business operated nationwide should be managed by the central financial supervision department, so the online microfinance license is in the industry. "Superbirth" argument.
But after Ant Group announced its IPO, people realized that this inconspicuous lending qualification turned out to be the cornerstone supporting Ant's 2 trillion yuan valuation.
Regulators have also noticed the risks.
In February 2017, Li Junfeng, former director of the Inclusive Finance Department of the China Banking Regulatory Commission, pointed out at the first member representative meeting of the China Association of Small Loan Companies that the approval of nationwide online small loans has exceeded the responsibilities of local financial regulatory agencies and should be treated with caution The cross-regional online micro-loan prevents the formation of new regulatory arbitrage or risks.
During the window period that is not expressly prohibited by regulatory documents, many companies are rushing to apply for online micro-loans out of business needs or hoarding licenses, and many places are also stepping up to approve online micro-loans out of consideration of investment promotion, including Xinjiang Wusu and Inner Mongolia. Hohhot, Wuhai in Inner Mongolia, Shuangyashan in Heilongjiang, Lhasa in Tibet, Yinchuan in Ningxia, and Linfen in Shanxi have all established online microfinance companies.
"Wherever the policy is loose, shareholders will go to establish a new online microfinance company." A senior person in the microfinance industry introduced.
On November 21, 2017, the Office of the Leading Group for the Special Rectification of Internet Financial Risks issued an urgent document requesting the microfinance regulatory authorities at all levels to immediately suspend the approval of online microfinance.
The barbaric and disorderly development of Internet lending has greatly squeezed the living space of traditional small loans.
According to data from industry associations and the China Banking and Insurance Regulatory Commission, the number of traditional microfinance companies has shrunk from 12,000 at the peak in 2015 to more than 9,000 at the end of 2019, and the number of employees has decreased from more than 100,000 to less than 75,000.
In four years, more than 3,000 traditional microfinance companies have left the market sadly.
Today, the return of online microfinance to offline or provincial operations is also challenging.
Prior to this, the profit margin of microfinance companies has been greatly squeezed.
On August 20 this year, the Supreme People's Court revised the upper limit of judicial protection of private lending interest rates to 4 times the LPR, or 15.4%, which is a significant drop from the previous benchmarks of 24% and 36%.
According to industry sources, the regulatory measures for online microfinance have been brewing for more than three years until the "Draft for Comment" was released on November 2 this year.
As far as the industry is concerned, the "Draft for Comments" has extensive influence.
Only "the registered capital of a microfinance company operating online microfinance business is not less than RMB 1 billion, and is a one-time paid-in monetary capital; the microfinance company operating online microfinance business across provincial administrative regions The registered capital is not less than RMB 5 billion, and it is a one-time paid-in monetary capital." This rule puts many online microfinance companies out of the door.
In the opinion of many industry insiders, in terms of registered capital, compared with Ant Group, smaller online microfinance companies whose main business is joint loans are more affected, their living space is greatly reduced, and many will face transformation. Or exit.
In the interview, Guo Tianyong also believed that the threshold for the entire company engaged in online microfinance has been greatly increased.
Whether it is for large companies like Ant Financial or some small ones, it will definitely have a great impact on business development in the future.
In response to the issue of entry barriers, Yin Zhentao said that the increase in entry barriers will slow down the overall growth of the entire online microfinance market, which means that it will be more difficult to apply for a national business license for online microfinance companies.
"Online microloans operating across provincial administrative regions require 5 billion yuan and are a one-time paid-in monetary capital. This threshold will limit most current online microloan companies."
In response to the new regulations, Tencent Tenpay quickly made adjustments.
On November 4, Shenzhen Tenpay Network Finance Microfinance Co., Ltd. undergoes an industrial and commercial change, and its registered capital increased from 1 billion yuan to 2.5 billion yuan, an increase of 150%.
It is understood that this is the second capital increase of Tenpay this year.
Regarding the standards set by the new regulations, Huang Dazhi, a senior researcher at Suning Financial Research Institute, said in an interview with the media that small and medium-sized microfinance companies are more affected by this regulation, and it is difficult for companies with weaker capabilities to reach 1 billion yuan and 5 billion yuan. The yuan standard will cause a large number of small loan companies with no strength to withdraw from the market.
In the past, many microfinance companies operated across provinces, but now the 5 billion threshold will force some online microfinance companies to operate only in the province, which limits the value of their licenses to a certain extent.
"For giants, the 5 billion yuan registered capital threshold is not difficult to reach, and even more difficult lies in the approval of the China Banking and Insurance Regulatory Commission."
According to Huang Dazhi’s analysis, the stipulation that the “capital contribution ratio should not be less than 30%” will only have an impact on individual online microfinance companies in a certain sense, because ant joint loans account for 90% of the entire joint loan market Market share.
Tiger Securities Investment Research team believes that under the limit of 30% of the capital contribution ratio, the profit prospects of the entire industry will be weakened. Instead, the risk of credit assets is greatly reduced and the risk of default is reduced.
Fully included in the scope of supervision
Online loan industry is facing a reshuffle
The "Draft for Solicitation of Opinions" that has aroused heated discussion in the market consists of seven chapters and forty-three articles, which are divided into general provisions, business access, business scope and basic rules, operation management, supervision and management, legal responsibilities, and supplementary provisions.
Each of these items is a "heavy punch" for the online microfinance industry, and as the regulatory fence gradually tightens, the "tightening curse" of the online microfinance industry is gradually tightening.
"Currently, with regard to online microfinance, especially joint loans, the regulatory authorities have carried out certain restrictions and management from both ends, which can be regarded as a systematic regulatory framework." Yin Zhentao said.
"At present, loans from microfinance companies have been fully included in the limited scope of supervision, while private lending has no license and no entity, so there is no way to include it in the scope of supervision. At present, the regulatory agencies can only include these licensed and The microfinance institutions of fund institutions are included in the scope of supervision. It is already very good to be able to do this." Guo Tianyong said.
In the eyes of many people in the industry, the biggest highlight of the "Draft for Comments" is that it strengthens the principle of protecting borrowers and requires lenders to pay attention to borrower suitability management, which is a core principle of inclusive finance.
The "Draft for Comments" has clear requirements in many aspects. For example, microfinance companies operating online microfinance business should reasonably determine the loan amount and duration based on the borrower’s income level, overall debt, asset status and other factors. The borrower's repayment in each instalment shall not exceed its repayment ability, and the balance of single-family online microloans for natural persons shall be restricted to RMB 300,000, and shall not exceed one-third of their average annual income in the past three years.
It is prohibited to induce borrowers to over-debt, to collect loans through violence, intimidation, insult, slander, or harassment, to collect, store, and use customer information without authorization or consent, and to prohibit illegal trading or disclosure of customer information.
"Whether consumers can enjoy the benefits depends on how each organization does it. In theory, after the regulatory threshold is set, operating costs will rise. There may be some organizations that let wool out of the sheep, from the consumers. The money collected will further increase and the interest rate will become higher. In theory, this possibility is not ruled out." Guo Tianyong analyzed.
However, it is worth noting that the "Draft for Comment" has also brought benefits to online microfinance companies that comply with laws and regulations, that is, it broadens the funding channels of online microfinance companies.
It is clearly stated that if a microfinance company operates online microfinance business, has good management, strong risk control capabilities, and regulatory evaluation that meets certain standards, it can use the company's online microloans as basic assets to carry out asset securitization Business, bond issuance.
In this regard, Guo Tianyong believes that in the future financial technology regulatory environment, the regulatory agencies still hope to manage according to the principle of substance over form. "Whether it is financial technology or not, whether it is an Internet company or a traditional financial company, as long as Those engaged in similar financial businesses are subject to the same regulatory standards."
"It is very important for the guiding direction of financial technology to give play to the characteristics of small inclusive benefits. It does not mean that financial technology is not completely eliminated, but to allow it to develop more standardized. From this perspective, the next step of financial technology There is a lot of room for development." Yin Zhentao said, "Supervision also needs to keep pace with the times. You cannot use traditional understanding and perspective to supervise new things. In addition, it is also very important that no matter what your product is. , What kind of supervision method is, we must always protect the rights and interests of consumers."
Cartography/Li Xiaojun