In the early days when the credit card installment business was launched, banks often advertised under the banner of "interest-free", and indeed many citizens were "fooled". In fact, interest-free is not free, just a different name.
generally speaking, the handling fee for general credit card installment payment for one year is lower than the annual cash withdrawal interest of 18% and higher than the bank's one-year commercial loan interest of 5.31%. It is worth mentioning that the loan interest rate of commercial banks has been lowered many times in recent years, but the standard of credit card installment fee and cash withdrawal interest has rarely changed. Although the standards of credit card installment fees in different banks are different, the calculation methods are roughly the same.
Most domestic banks have credit card installment business. Installment payment is generally divided into POS installment, "mail order installment" and bill installment through internet and mail according to different occasions.
suppose the installment amount is 12 yuan, divided into 12 installments, and 1 yuan will be repaid in each installment (month). The handling fee is .6%/ month, and the actual monthly deduction is 1+12×.6%=17.2 yuan. If other factors are not considered, the convertible nominal annual interest rate is 7.2%. However, the cardholder does not always owe the bank 1,2 yuan. In the last month, he actually owes the bank 1 yuan, but the bank still charges a handling fee of 1,2 yuan.
according to the calculation, the real annual interest rate that the cardholder has to pay is about 15.48%. According to the correct calculation formula, it should be 12 * .6% * (1+.6%) 12/((1+.6%) 12-1) = 13.94 yuan, with an extra handling fee of 3.2% per period.
From the form of installment payment, the cardholder's starting amount for handling this business is limited, and the level of installment repayment and the standard of handling fee are also different, which can be roughly divided into three categories:
The first category is carried out by banks in cooperation with special merchants, but the types of products are limited;
the second category is the product catalogue provided by the bank, which is selected by the cardholder, and then the bank entrusts the supplier to deliver the goods to the customer;
The third category is not limited to merchants and commodities. Cardholders only need to apply to the bank for installment repayment after shopping. Some banks even set the acceptance scope as global.