Since the end of last year, it has been reported that the regulatory authorities have asked licensed consumer institutions to adjust the annualized interest rate. Some borrowers smell a good opportunity to reduce debt, but for consumer institutions, it means painful "cutting meat".
Because with the rising cost of customer acquisition and collection, once the new interest rate "red line" is implemented, the profit model of the consumer gold industry will change. So, under the new rules of the game, how should players break through?
The interest rate algorithm is very tricky
As borrowers become more and more sensitive to loan interest rates, the calculation caliber of interest rates has also begun to receive attention.
Recently, JuComplaint, a third-party complaint platform, released 20 19 annual reports of various industries. In the related industries of Internet finance, JuComplaint disclosed a lot of data and information, and the algorithm of loan interest rate also became the "annual observation" of the report.
At present, the interest rate calculation method adopted by most lending platforms in the mutual gold industry is the APR nominal interest rate algorithm of interest/principal. For installment repayment, the principal decreases with the monthly repayment amount. In fact, IRR is used to calculate the interest rate, which can more truly reflect the borrowing cost.
Taking a cash loan platform as an example, the overall borrowing cost of its external publicity does not exceed 36% of the borrowing amount, but the interest rate after recalculation with IRR is 84%.
On 20 18, 1 1 month, the complaint convergence platform launched an effective complaint solution for the internet consumer finance industry, that is, the 2 1CN complaint convergence platform Internet consumer finance complaint handling rules (version 3.0), in which mutual gold merchants are encouraged to adopt IRR as the interest rate calculation method and actively provide repayment plans to solve complaints.
The report mentioned that this settlement plan for gathering complaints has been recognized by many mutual gold merchants. In the past year or so, more than 13700 complaint posts were closed after being handled according to this plan. In handling complaints, many online lending platforms voluntarily use the IRR algorithm suggested by complaints to calculate interest rates.
Compared with the scheme formulated by collecting complaints, the signals released by official institutions deserve our attention.
2065438+In March 2008, the National Internet Financial Security Technical Expert Committee publicly stated that the IRR calculation method is more scientific and appropriate. 20 19 February 26th, 19, People's Bank of China posted a message on WeChat WeChat official account, pointing out that the common installment interest rate not based on IRR formula in the market belongs to the interest rate trap.
Common interest rate "trap" analysis Source: WeChat official account of China People's Bank
20 19 10 2 1 Opinions on Several Issues Concerning Handling Criminal Cases of Illegal Lending (the Supreme People's Court, the Supreme People's Procuratorate, Ministry of Public Security, Ministry of Justice) was formally implemented, and it was clear that "usury should be punished". Since then, some platforms have adjusted the annualized interest rate of products to below 36% according to IRR's interest rate calculation method.
Although there is no clear stipulation on what kind of interest rate calculation method should be used for loans in the gold consumption industry, IRR has become the general trend from the existing information.
It is worth mentioning that while strictly regulating the lending rate of lending institutions, the supervision has recently drawn a new "red line" of interest rates, which will promote the transformation of the consumer gold industry and accelerate the reshuffle.
24% interest rate "red line"
At the end of last year, news broke out that some licensed consumer financial institutions, including Industrial Consumer Finance and Jin Meixin Consumer Finance, received oral supervision notices, explicitly requiring that the interest rate of loan products be adjusted below the annualized IRR from June 65438+ 10/day in 2020, and the penalty interest should be controlled within 30% of the annualized interest rate.
As soon as the news came out, many senior executives of consumer companies began to ask for interest rate adjustment. In addition, according to incomplete statistics, a number of Internet giants and financial technology companies have actively or passively adjusted the loan interest rate to below 24%, including Ant Financial, Baidu, Tencent, JD.COM, Meituan, Xinya Technology, Jianpu Technology, Shuhe Technology and Orange Staging.
Some borrowers told the consumer society that it is undoubtedly a good thing to cut interest rates and reduce interest rates. Another borrower said that he had borrowed money from multiple platforms and could borrow some low-interest loans to repay the previous high-interest online loans and reduce debts. This is a good opportunity to go ashore.
According to the Provisions of the Supreme People's Court on Several Issues Concerning the Application of Laws in the Trial of Private Lending Cases, if the interest rate agreed by both borrowers and lenders does not exceed 24% per annum, and the lender requests the borrower to pay interest at the agreed interest rate, the people's court shall support it. The interest rate agreed between the borrower and the borrower exceeds the annual interest rate of 36%, and the interest agreement in excess is invalid. The people's court shall support the borrower's request to the lender to return the part of the interest paid that exceeds 36% per annum.
According to the judgment information of China Judgment Document Network, Xiaojinshe found that in many judgments involving consumer finance, loans, interest rates and interest, the court did not support the part where the loan interest rate exceeded 24%.
According to the statistics of Zero One Think Tank, the low annual interest rate of credit products of consumer finance companies is between 10% and 15%, and the high annual interest rate is between 18% and 36%. It is reported that the annual interest rate of credit products of many consumer finance companies has reached the regulatory "red line" of 24%.
Some insiders told consumer finance that the finalization of the "red line" of the new interest rate means that it is difficult for consumer finance companies to continue to adopt a business development model with high interest rates and high risks. For most industry players, the risk cost remains unchanged, the operating cost rises and the capital cost is high. If the loan interest rate is reduced from 36% to 24%, the original business model will be greatly impacted.
At present, most of the services provided by licensed consumer companies are long-tail customers that are hard to reach by banks and other financial institutions, and the risk of default of these customers is high. Therefore, consumer companies need to cover the risk of bad debts by appropriately higher interest rates than banks.
"Once the annualized interest rate of products falls below 24%, in order to keep the risk under control, the company will shift its focus to a better customer base. In other words, they can only abandon customers with lower returns and higher risks, and even compete with commercial banks for credit card crowds. " The industry insider said.
An employee of a licensed gold consumer marketing department revealed to gold consumers that their company's budget for 2020 is almost half less than that of the previous year. "Different loan interest rates correspond to consumers with different incomes, different risk preferences and even different solvency. The customer base is different, and the marketing strategy will naturally change accordingly, so it takes time to test and polish. Prior to this, childbirth was naturally conservative. "
On the other hand, for licensed financial institutions, the 24% interest rate regulation also means that the days of relying on lending institutions and simply exporting funds are over.
It is understood that at present, many licensed consumers mainly engaged in online business use the loan-helping model, and they lend money through cooperation with Internet giants. For example, Hubei Xiaojin realized the loan through Jiufuwanka, and Shengyin Xiaojin cooperated with platforms such as installment music and science finance to realize the loan.
According to the calculation made by media consumers, the annualized capital cost (including the annualized conversion of margin) of the lending platform is about 13.5%- 14%, the risk bad debt cost is about 5%, and the operating cost is about 4.2%. Based on the above data, the total cost of the lending platform is basically around 23%.
"According to the annualized interest rate of 36%, there are double-digit profit margins. According to the regulated interest rate of 24%, faced with almost the same cost, most institutions are difficult to operate normally, let alone make profits. " The staff of a financial technology platform said so.
According to media reports, a number of Jin Mu platforms have recently stopped lending cooperation with licensed institutions, including some platforms whose asset quality and business scale have been recognized.
How to break the game?
In 2065 438+08-2065 438+09, the regulatory authorities carried out an all-round and multi-level structural rectification of the non-compliant business of unlicensed financial institutions, from collection, data companies, third-party payment to loan APP, and the industry ushered in a new starting point for compliance management.
Some insiders said: "Consumer finance has ushered in strong supervision, and those informal unlicensed institutions are very lucky to survive this year."
In this context, the risk cost and post-loan management cost are rising, and now the supervision begins to limit the annual interest rate of credit products to no more than 24%, which will narrow the profit space and market space of various market entities.
In addition, with the Internet giants such as Baidu, Ali, Xiaomi and Ping An successively approved to set up consumer finance companies, market competition is also intensifying.
Under the new situation, the consumer gold industry will enter the second half of the accelerated reshuffle, and will change from "extensive" development to "refined" development.
How to break the game?
According to industry experts, the target customers of consumer finance companies are mainly customers with interest above 18%, compared with the relatively high-quality customer base that mainly serves 18%.
Now banks are trying to sink their retail business. Driven by the new interest rate regulations, the customer base of consumer finance has moved up, and some businesses of both sides are bound to face direct competition. If we fight together, financial institutions are at a disadvantage in terms of offline network coverage, capital cost and license influence. Therefore, it is the breakthrough direction to identify the target customers and continuously improve service and efficiency.
At present, the population of cities, counties, towns and rural areas below the third line in China is nearly 654.38 billion. In this part of the customer base, many customers lack credit data, which makes risk management difficult, but this market is currently a place with relatively limited coverage of banking service network. Therefore, it is of great significance for consumer finance companies to provide convenient services for this group of high-quality customers, establish a compliant and effective risk control model, and identify fraud risks and personal credit risks. The development of financial technology provides conditions for solving this problem.
Specifically, the most direct effect of combining financial technology with various business scenarios is to reduce costs, improve efficiency and optimize user experience. At present, the frontier financial technology represented by artificial intelligence, big data, blockchain and cloud computing is developing rapidly, and financial institutions, especially consumer finance companies, pay more and more attention to financial technology.
According to "Technology Empowerment: Consumer Finance Industry Development Report 20 19" of Zero One Think Tank, the technology investment of China's consumer finance business of 2015.75 billion yuan is expected to reach 38.73 billion yuan by 2022.
By the end of 20 1 1 2009, 8 of the 24 consumer finance companies in China had applied for patents publicized in China National Intellectual Property Administration, and the number of patents publicized reached 139, of which 54 were instant consumer finance, accounting for 39% of the total, while Suning and Zhaolian had 36 and 30 respectively.
Number of patent applications published by consumer finance companies Source: Zero One Think Tank, World Intellectual Property Organization Statistical Database.
It is understood that at present, seven consumer finance companies have developed their own intelligent credit information system through independent research and development. These systems mainly involve artificial intelligence and big data. The application scenarios cover intelligent payment, credit scoring, intelligent collection, intelligent customer service, risk management, anti-fraud identification and so on.
Therefore, some insiders pointed out that while continuously improving the level of financial technology, licensed institutions can maintain existing users of the platform and develop new products with compliant interest rates, thus revitalizing existing users and improving the refinancing rate.
On the other hand, we can start from the B-end, and use our own service advantages of deep-rooted scenarios and complete lending service process capabilities such as capital, data and risk control to export financial technology solutions to banks, Internet companies and third-party payment institutions. According to the incomplete statistics from the media consumer finance channel, Gitzo Consumer Finance, Instant Consumer Finance, Zhaolian Consumer Finance, Haier Consumer Finance and many other institutions have exported financial technology services.
In addition, in view of the situation that the cooperation mode of loan assistance will be impacted in 2020, it is also an unavoidable step for licensed institutions to lay out their own business and cultivate their own refined operation ability.
For example, by actively participating in the capital market, expanding channels such as asset securitization ABS and financial bonds to reduce financing costs; By meeting the credit needs of different users, strengthening product differentiation, expanding diversified income under the advantage of its own consumption scene, and improving the overall operation level of Xiaojin Company in many aspects.
So far, the news of interest rate adjustment is only limited to the verbal notice of some consumer companies. According to the overall spirit of interest rate marketization, it is expected that the formal regulation of annualized 24% will first form a tacit understanding among national ministries and commissions, and this process will take some time. In addition, the current epidemic prevention and control in COVID-19 not only brings challenges to the development of the consumer gold industry, but also increases the buffer space for the implementation of the new policy to some extent.
In any case, it will come, and under the policy dividend of drifting away, the "high interest era" of eliminating gold will end. Consumers need to recognize the reality and constantly strengthen their core competitiveness. Only in this way can they have a chance to break through in the new industry game rules.