The annualized handling fee is approximately 7%-10%.

For example, China Construction Bank launched the "Apply for Installment and Enjoy Discounts" campaign for credit card consumers. During the campaign, cardholders who successfully apply for bill installments can enjoy a handling fee as low as 30% off (i.e. 3 installments) 0.53%, 6 periods 0.49%, 10 periods 0.46%, 12 periods 0.42%, 18 periods 0.42%, 24 periods 0.43%).

It is worth noting that China Construction Bank also clearly stated in the display interface the approximate converted annualized service rates after the "Enjoy Discount" activity, which are: 9.51% for 3rd period, 10.01% for 6th period, and 10th period. 9.91%, 9.18% in 12 periods, 9.34% in 18 periods, 9.61% in 24 periods. The approximate annualized fee rate is calculated by annualizing the internal rate of return. It is not the ratio of the fee/transaction amount paid by the consumer. The actual amount of the fee paid is still based on what is listed on the bill.

Related information

For a long time, when financial institutions issue various types of loans to individuals, the interest rate display has generally been "unclear and difficult to understand". To this end, the central bank has introduced a regulatory policy of “explicit annual interest rates on loans”. Some banks have begun to try to clearly indicate to consumers the annual interest rate of credit card installments. This not only allows consumers to have a clearer understanding of loan information, but also lays the foundation for effectively curbing "impulsive consumption".

But at the same time, the explicit annualized installment interest rate also puts forward higher requirements for bank user stratification and risk pricing. In many complaints, consumers mentioned situations such as "the borrowing interest rate is unclear" and "the interest calculation method is not clearly informed to customers". The reason is mainly because it is difficult for most consumers to intuitively form the concept of "annualized interest rate", so that consumers can clearly understand the true cost of borrowing.