Consumer finance should be gone
Author: Zhang Rui Source: China Financial and Economic News Published: 2019-05-28
The recently concluded annual financial report shows that in the consumer financial market, in addition to the net profit of two leading institutions, Gitzo Consumer Finance and China Merchants Consumer Finance, more than 1 billion yuan in consumer financial companies have a profit of less than 100 million With more than 10 companies, Happiness Consumer Finance also suffered its first annual loss. Obviously, in terms of profitability and market performance, there has been a clearer trend of differentiation between consumer finance companies, coupled with the tightening of regulatory policies, consumer finance companies that have been running away for several years will have to self-optimize. And full fitness.
Consumer finance companies are the core subjects in the domestic consumer finance matrix, and are currently composed of 23 institutions including BOC Consumer Finance, China Post Consumer Finance, and Gitzo Consumer Finance. The other two entities in the matrix are commercial banks and Internet finance. The former mainly provides consumer financial services through consumer credit (real estate loans) and credit cards. The latter mainly includes financial service products under the BATJ, such as those operated by Baidu Du Xiaoman. "Rich Money", "Particle Loan" launched by Tencent Weizhong Bank, "Hua Yuan" operated by Ali Ant Financial Services, and JD.com White Bar under JD Finance. P2P, online micro-loans, as well as the “reliable borrowing” developed by today ’s headline, and the “dishui loan” launched by Didi are also included in this column.
Consumer finance companies are licensed non-bank financial companies in nature. Compared with commercial banks, their biggest feature is scene consumption, which is to provide targeted consumer demand for experience-oriented consumption. Therefore, although many consumer finance companies are currently led by banks, they are all tied to the non-banking industry. For example, Shanghai Zhongcheng Consumer Finance stands behind important shareholders such as Ctrip Group, Ningbo Yongying Consumer Finance's important investors are Fubon Furniture and Ningbo City Plaza, and China Everbright Consumer Finance's important joint partner is CYTS. And physical enterprises such as Haier and Suning have also created industrial consumer finance, and their linked consumption scenarios are more grounded. Compared with consumer finance companies, although Internet finance also has scene consumption characteristics (mainly online scenes), for example, "rich money" relies on Baidu search scene, "particle loan" relies on social scenes, and "flowers" back Relying on e-commerce scenarios, etc., but Internet finance belongs to unlicensed consumer finance, and its leverage ratio is much lower than that of "authentic" consumer finance companies. The former is only about 2.3 times, and the latter can be enlarged to about 8-10 times. , The greater the business space, the greater the flexibility.
It is precisely because of the advantages that commercial banks and Internet finance do not have. In the eight years since its establishment, consumer finance companies have been running very quickly and happily. Tens of millions, and the amount of loans at the same time are tens of billions or even hundreds of billions. In addition, according to regulations, consumer finance companies do not have the ability to absorb reserves, so since last year, the industry has entered a track of rapid asset expansion. For example, the registered capital of China Post ’s consumer finance jumped from 1 billion yuan to 3 billion yuan; the registered capital of consumer finance immediately increased from 2.21 billion yuan to 4 billion yuan; The scale has also expanded from 361 million yuan to 3.209 billion yuan. Harbin Yinfeng Consumer Finance, which was established just one year ago, has also completed a capital increase plan, and its registered capital has increased from 1.05 billion yuan to 1.5 billion yuan.
Huge market potential
Consumer finance serves consumer behavior, and the purpose is to leverage the consumer's appropriate debt to leverage the consumer market. Therefore, the biggest contribution of consumer finance should be to expand the domestic endogenous power of the economy. Data show that the current total retail sales of consumer goods in China are close to 40 trillion yuan, and the final consumption contribution to economic growth has exceeded 76%. Consumption has become the first driving force for economic growth for five consecutive years, and its main role in driving the economy has been basically established. . In addition, traditional finance can cover high-quality customer groups such as white-collar workers and high-net-worth individuals, while the financial needs of a large number of long-tail customers such as college students and young blue-collar workers cannot be met. Consumer finance fills the gap in the financial supply side by creating a credit supply method with low thresholds, unsecured and fast approval channels, so that the inclusive function of modern finance can be demonstrated. Not only that, the continuous innovation of consumer finance at the level of varieties and scenarios has forced traditional financial institutions such as banks to accelerate the pace of retail business iterations, and at the same time activated the innovation genes of the entire financial market. According to statistics, last year, the domestic transaction size of ABS (asset securitization) issuance volume in consumer finance alone reached 300 billion yuan.
According to the information disclosed by the central bank, last year, domestic short-term loans among domestic financial institutions increased by 2.41 trillion yuan, an increase of 31% year-on-year, which means that the growth rate of China's consumer finance has exceeded 30%. In addition, the current domestic short-term RMB loan stock is 8.8 trillion yuan. Based on an annual growth rate of 20%, there is no doubt that domestic consumer finance will reach 10 trillion yuan next year. Not only that, compared with the United States, where the consumer credit model is more mature, China's consumer financial penetration rate (short-term consumer loans / consumption expenditure) is at a relatively low level, only 60% of that in the United States, and the market potential is still great. More importantly, there are still a large number of people in China's fourth- and fifth-tier cities and the vast rural areas who are in demand but have not received financial services. At the same time, as the post-95s and post-00s have grown up and entered the society, these people are bound to become a new force in the consumer financial market. Therefore, more financial and industrial capital will join the consumer finance camp in the future.
However, looking back, in the recent years of continuous expansion of consumer finance, there have been many deviations from the track and misalignment. For some time, the entire industry has been in a state of barbaric growth. In addition to the dazzling Internet financial products, the growth rates of bank credit cards in the past two years have been as high as 26.45% and 16.67%, respectively. The cumulative number of issued cards has soared from 588 million in the previous year to 686 million in last year. Although the number of domestic per capita cards is currently only 0.49, the cardholders have been significantly younger. According to the statistical conclusions of the "Credit Card Industry Report 2018" jointly issued by 51 Credit Cards, the proportion of card holders after 90 to 00 is as high as 67.86%. In order to win more customers, many consumer finance providers have published a large number of false information on online and offline channels to entice young people to lend, while relaxing the necessary review of lenders' qualifications and credits, and doing everything possible to circumvent the limit of credit lines of supervisors .
The partial disorder of consumer finance has brought some economic and social problems. According to the conclusion of the "2018 China Consumer Credit Market Research", the users of consumer finance in China are mainly younger groups, of which the group of 18 to 39 years old uses consumer credit for more than 66%. Except for a few people whose income can cover the repayment needs of consumer finance, most of them belong to the group with lower income and poor ability to repay loans. Because of this, last year's credit card overdue for half a year was as high as 78.861 billion yuan, which led to a simultaneous increase in the bank's non-performing assets ratio. The “White Collar Satisfaction Index Survey Report 2018” released by Zhilian Recruitment shows that more than 20% of white-collar workers were in a state of economic debt last year, becoming typical “Moonlight” and “Busy”. Many young people, in the concept of pre-consumption, willful consumption, and hedonic consumption, borrowed excessively at will and eventually passed on debts to parents and families. As a result, the debt ratio of the domestic resident sector exceeded 50% last year, and 60% of developed countries The household debt ratio is moving forward.
From a more macro point of view, because more people's actual income does not support debt service payments, consumer expenditures will inevitably be reduced after some or all of the debts are settled. Therefore, although consumer finance can stimulate consumption “blowout”, excessive leverage may also form a squeeze on consumption. Data show that after hitting the lowest point since 1999 last year, the total retail sales of consumer goods in the first four months of this year contracted again by 1.7 percentage points year-on-year, and the sustainability of consumption growth remains to be seen. In addition, domestic inflation is on the rise. Although the overall CPI increase in the first four months of this year was only 2.5%, the prices of pork, vegetables and fruits, which are closely related to the daily lives of residents, have soared 18.7%, 15.6%, and 14.4%. With the weakness of upstream raw material prices, the prices of domestic core consumer goods have risen sharply. In addition, it is also worth noting the social pension risk caused by consumer finance. According to the "2018 China Pension Outlook Survey Report" released by Ant Financial, 56% of the young Chinese under 35 years of age have not yet started saving for the elderly, and the average savings per person in the 44% group is only 1339 yuan per month. Some young people are in "Zero savings" status.
Original Qingyuan depends on system design
Regarding the "disorder" anyway in consumer finance, the supervisors have frequently resorted to it in recent years. For example, carry out special rectification of Internet financial risks, suspend campus loans, and implement "broken direct connections" to third-party payments. At the same time, several guidance documents such as the “Notice on Regulating the Rectification of“ Cash Loan ”Business” were also issued. At present, both the issuance of credit cards and the issuance of consumer financial company licenses have shown signs of significant slowdown. However, clearing the source of consumer finance cannot depend solely on special rectification or red-headed documents. It must depend on institutional design and mechanism specifications.
One is to speed up the construction of credit information infrastructure while controlling licenses. Open the personal database of the central bank and the personal database of third parties in the society, and all credit information will be migrated to the central bank's credit information system. Based on this, a reasonable and effective regulatory framework for consumer finance business is established, and appropriate guidance is provided for loan interest rates and loan quotas.
Second, it is necessary to strengthen the appropriate management of credit demand side through financial technology. Relying on artificial intelligence and blockchain technology to create a sensitive identification mechanism for various indicators such as property income and debt status of fund borrowers, and based on this, reasonable credit is granted to isolate financial risks brought by high leverage.
Third, based on the establishment of a joint disciplinary system for dishonest persons, the results of dishonesty treatment should be properly disclosed, so as to construct a good financial atmosphere with proper borrowing and orderly consumption. Conduct targeted consumer education for young consumer groups through university classrooms, online media, and catering and entertainment venues, and guide them to develop behavioral preferences for reasonable debt and rational consumption. (The author is a member of the China Marketing Association and a professor of economics)