If everyone does this, then for banks, the most direct impact will be a decrease in credit card income, or even making ends meet, which will ultimately reduce the promotion of credit cards, increase card usage costs, or directly cancel credit cards.

Income composition of credit cards

Bank credit card business income mainly consists of the following parts:

(1) Interest income: including interest on overdraft cash withdrawals, overdue cash withdrawals Interest, etc.;

(2) Installment fee: In fact, the installment fee is the installment interest, but it is just another way of saying it;

(3) Breach of contract Deposit: Liquidated penalty refers to the previous late payment penalty. On April 15, 2016, the central bank issued the "Notice of the People's Bank of China on Matters Related to Credit Card Business", which canceled the late payment penalty provisions and left the card issuer and cardholder to agree on the penalty;

(4) Merchant commission: It is the settlement fee paid by the acquiring merchant to the card issuing bank and card issuing organization when the cardholder chooses to use a bank card for settlement (the current charging standard is generally 0.6).

(5) Other parts: including annual fees, cash withdrawal fees, etc.

Among them, interest income and installment fees account for the most important parts. Merchant rebates (i.e., card swiping fees) only account for about 15%. If everyone repays the loan in full before the repayment date, If there is no installment and minimum repayment, then the bank's installment fees, liquidated damages and interest income will disappear completely. If the customer does not withdraw cash and overdraft, then the income from the bank's credit card will only be the merchant's commission and annual fee. . This part currently only accounts for about 18%, which means that the bank's credit card revenue has directly decreased by more than four-fifths.

There is some uncertainty about how the remaining income can support the operation of the bank's entire credit card team. Even if it can be sustained, the bank's credit card income will be significantly reduced. For example, the credit card revenue in 2017 Wang CMB's credit card revenue of 54.451 billion yuan will be directly reduced to about 9.8 billion yuan, which is less than 10 billion yuan.

How to solve it?

If everyone does this, as long as the bank does not want to abolish the credit card business, then in order to ensure the profits of the credit card business, other measures will definitely be taken to remedy the situation, such as canceling the annual fee exemption and canceling points exchange. Gifts, canceling various credit card swiping promotions, increasing merchants’ card swiping rates, etc. will make up for some of the losses. By then, everyone’s card usage costs will rise to a certain extent.

Summary

In fact, there is no need to worry too much. This situation will never happen. Just like there are a thousand Hamlets in the eyes of a thousand people, everyone's situation is different. Yes, it is simply impossible for everyone to make no installments or minimum repayments.