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What are the aspects of consumer finance supervision in China?
20021July 15, official website, China Banking Regulatory Commission, announced that China Banking Regulatory Commission recently issued the Measures for Supervision and Evaluation of Consumer Rights Protection in Banks and Insurance Institutions, which will come into force as of the date of promulgation. With the implementation of the Measures, consumer protection will be embedded in the operation and management of banks and insurance institutions, and a series of regulatory measures such as notification and rectification within a time limit will be taken for institutions with regulatory evaluation results of Grade III or below.

In recent years, the China Banking Regulatory Commission has attached great importance to the protection of financial consumers' rights and interests, established rules and regulations to promote the construction of consumer protection system and mechanism, concentrated on rectifying the chaos that infringes on consumers' rights and interests through on-site inspection, complaint supervision and administrative punishment, and improved consumers' financial literacy through education and publicity, risk warning and case notification. In 2020, the CBRC urged banks and insurance institutions to pay consumers 654.38+077 billion yuan.

However, the digitalization of financial transactions, the structuring of financial products and the diversification of market subjects pose greater challenges to the protection of consumers' rights and interests. The problems reflected by consumers focus on campus loans, credit cards, wealth management, insurance and other businesses, involving false propaganda, misleading sales, bundling and tying, and overlord clauses. In addition, in the cooperation between licensed institutions and Internet platforms, there are all kinds of chaos that infringe on consumers' rights and interests, such as violent collection, high interest rates, lending to minors, and leaking customer information. The above-mentioned new problems require the establishment of a supervision and evaluation system to urge banks and insurance institutions to embed consumer protection into their management.

The Measures issued by the CBRC this time are aimed at banks and insurance institutions established in China to provide consumers with financial products or services, mainly including commercial banks, wealth management companies, trust companies, auto financing companies, consumer finance companies and insurance companies.

First, cooperation with Internet platforms needs to strengthen consumer protection management.

In order to better urge institutions to perform their main responsibilities, the Measures include banks and insurance institutions legally established in People's Republic of China (PRC) to provide financial products or services to consumers, mainly including commercial banks, insurance companies, wealth management companies, trust companies, auto finance companies and consumer finance companies.

In addition, in view of the chaos of consumer rights protection on Internet platforms and the complexity and multi-layer nesting of financial products, the Measures also set indicators such as cooperative organization management and consumer rights protection audit, requiring banks and insurance institutions to strengthen the protection and management of consumer rights of third-party cooperative institutions such as Internet platforms. The person in charge said that in this way, the review of consumer rights protection has been strengthened, and the risk control barrier has been moved forward to prevent products from being listed "sick".

Two, the regulatory evaluation elements are composed of six items.

Chapter VI of the Measures consists of 35 articles, including general principles, evaluation elements and grades, division of responsibilities and operating procedures, evaluation results and application, organizational guarantee and work requirements, and supplementary provisions. Among them, the evaluation elements include five basic elements: system construction, mechanism operation, operation service, education and publicity, dispute resolution and supervision and inspection 1 burden reduction elements. The total weight of the five basic elements is 100%.

Among them, the system construction mainly evaluates the corporate governance and organizational structure construction related to the protection of consumer rights and interests of bank insurance institutions, with the weight of10%; Mechanism and operation mainly evaluate the construction and operation of the working mechanism of consumer rights protection in bank insurance institutions, including consumer rights protection review, information disclosure, personal information protection, internal training, internal evaluation and internal audit. , with a weight of 25%; Operation and service mainly evaluate the implementation of consumer rights protection requirements by bank insurance institutions in their daily operations and services, including but not limited to marketing promotion, appropriateness management, sales behavior control, cooperative organization management, service quality and fees. , with a weight of 30%; Education publicity mainly evaluates the overall arrangement of bank insurance institutions, centralized education publicity activities and normalized consumer education, with the weight of10%; Dispute resolution mainly evaluates the complaint management of banks and insurance institutions, the number of complaints and the implementation of diversified dispute resolution mechanisms, with a weight of 25%; Supervision and inspection, according to the on-site inspection, report investigation, complaint supervision, reconsideration litigation, daily public opinion, major negative events and the implementation of relevant institutional rectification of banks and insurance institutions, the deduction shall not exceed 25% of the total weight.

Third, take differentiated regulatory measures.

The "Measures" set four grades for the evaluation results: 90 points or above is the first grade, indicating that the protection of consumer rights and interests of banking and insurance institutions is at the leading level in the industry; 75 points (inclusive) to 90 points are divided into two grades, that is, the protection of consumer rights and interests of banking and insurance institutions is at the middle level of the industry; 60 (inclusive) to 75 are divided into three grades, which means that the protection of consumer rights and interests of bank insurance institutions is at a low level in the industry; The score below 60 is Grade 4, which means that the protection of consumers' rights and interests of bank insurance institutions is at a backward level in the industry. In order to enhance the accuracy of the evaluation results, the second and third levels are subdivided into three levels: A, B and C.

The above-mentioned person in charge said that the "Measures" clarify that the results of supervision and evaluation of consumer rights protection are an important basis for the regulatory authorities to formulate regulatory policies for consumer rights protection and implement classified supervision of consumer rights protection, and also an important basis for allocating regulatory resources and taking regulatory measures.

For the problems found in the evaluation, urge the institutions to rectify in time, implement the main responsibility, and effectively respond to the demands and difficulties of the people in the field of bank insurance. The CBRC will adopt differentiated supervision measures for bank insurance institutions according to the results of the supervision and evaluation of consumer rights protection.

According to the Measures, institutions whose evaluation results are Grade III are required to strengthen the construction and implementation of consumer rights protection systems and mechanisms by issuing risk warning letters, regulatory notices, ordering rectification within a time limit, and ordering internal accountability, and publicly disclose their misconduct when necessary.

For institutions with poor rectification measures based on the four-level evaluation results, relevant regulatory measures can be taken in developing new business and adding branches according to law.

It is reported that China Banking and Insurance Regulatory Commission, China will supervise and evaluate the protection of consumers' rights and interests in banking and insurance institutions every year, so as to improve the protection level of consumers' rights and interests in banking and insurance.

Carrying out supervision and evaluation of consumer rights protection can enhance the pertinence of consumer protection work of bank insurance institutions, urge institutions to examine the weak links of their own consumer protection work against regulatory requirements, play the role of regulatory "baton", and achieve full coverage of regulatory requirements and consumer protection.