On March 30th, it was learned from some local branches of joint-stock banks and state-owned large banks that multiple banks have received notices from their headquarters that the annualized interest rate for credit consumption loan products may be raised to no less than 3% from April. A staff member from the personal loan department of a branch of a joint-stock bank in East China reminded customers who have obtained loans with interest rates below 3% that “customers who have not withdrawn should withdraw before Monday (March 31st). In addition, the personal loan staff of state-owned banks in southern China have issued an internal notice stating that they will “promptly notify their respective customers of the measurement or withdrawal work”. Since the beginning of this year, a new round of “price wars” has swept through the consumer loan market. Many banks have launched consumer loan products with interest rates below 3% in order to seize market share. Many institutions have repeatedly lowered their product interest rates, with some bank products having interest rates as low as 2.4%, which is 10-70 basis points lower than the one-year loan market quoted interest rate (BP) announced by the central bank in March. Industry experts suggest that banks should consider customers’ repayment ability and should not excessively inflate interest rates. (Securities Times)
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