At the end of 2006, new terms such as "house slave", "car slave" and "card slave" began to quietly become popular. They vividly reflect the appearance of people today in modern consumer credit life. The social phenomenon of unbearable payment pressure. A survey by an authoritative organization shows that nearly 80% of Chinese citizens have loans of more than 400,000 yuan to buy a house. Among them, for more than 30% of families, the proportion of mortgage loan payment in monthly income has exceeded 50%; and, as high as 98.09% People who take out mortgages will have psychological anxiety, and some of these emotions have even escalated to the level of depression, confusion and short-sightedness. Another survey on home purchases among college students with higher education levels showed that 90% of the students surveyed said they were "unclear" about the recurring interest rate of their credit cards, and 75% of the students could not calculate the amount of bank loan interest. So, is the emergence of "negative people" in today's consumer credit life due to the "ignorance" of these parties? Or is it because China lacks the sound credit culture and credit system needed to ensure an advanced consumption lifestyle? Are there even deeper economic reasons?
In the following, the author will analyze the above questions from the perspective of economics, and will also further look into the development prospects and challenges of the credit economy in China.
1. There is nothing wrong with advanced consumption, but the “degree” of consumption should be exceeded.
Every time, in the first lecture of a finance course, I always like to use the once popular and deeply rooted dialogue between an American old lady and a Chinese old lady in heaven to explain modern finance. The most essential issues discussed in the study. Although the Chinese old lady has spent most of her life saving to buy a house, and the happy time she enjoys her new house seems far inferior to the advanced consumption model of the American old lady who borrowed money from the bank and bought a house in advance when she was young, but this It is a choice between two completely different views of "life and happiness". We cannot judge which way is the best.
Because the happiness of the old Chinese lady may come from being able to verify in advance every meaningful labor and labor income paid for buying a house, and may come from letting her children enjoy it together. The family happiness brought about by improved living conditions may also come from the absence of fear about future changes in income. As long as Chinese old ladies are satisfied and happy with their choices, then we cannot accuse this consumption method of being outdated! The same is true for excessive consumption. The choice of the American old woman may come from the fact that she can feel the joy of living independently without the care of her parents as soon as possible, or it may be that the pressure of repaying debts makes her future life and work more challenging. In short, as long as this choice is happy and reasonable for the parties involved, there is no reason to be picky. But what is incomprehensible is why today's Chinese society, especially among young people, regards advanced consumption as "fashion" but makes fun of and despises the consumption methods of old Chinese ladies? What is particularly sad is that they blindly imitate the consumption patterns of American old ladies without the values ??and social environment of them. As a result, the buzzword "advanced consumption" has been replaced by "house slave", "car slave" and "car slave" without realizing it. replaced by sad words like "Kanu".
Therefore, from a consumer perspective, in order not to make oneself pay a heavy price for "advanced consumption", one must first have a clear understanding of the "advanced consumption" model in advance. Financial theory emphasizes an important premise whether it is the savings-based consumption of Chinese old ladies or the debt-based consumption of American old ladies: that is, people's lifetime consumption expenditures cannot exceed their lifetime income! However, the grasp and understanding of this "degree" can also be seen from the results of the above survey, which is very problematic. There are many people who only think about "advanced consumption" and come up with various ways to achieve advanced consumption. As a result, when the "dunning orders" from the bank pile up afterwards, they begin to realize the existence of "degree" and are "degreed". "The ruthless and punishing power was overwhelming. Therefore, in this sense, risk education about excessive consumption should be popularized and strengthened among the whole people.
Secondly, we must strengthen the management of excessive consumption.
Before a scientific personal credit evaluation system is fully established, the state should increase its efforts to restrict excessive consumption behavior. At present, there are several social phenomena that deserve our attention: First, many young people regard their current income level and working environment as permanent. This "money illusion" problem can easily lead to an increase in the scale of excessive consumption. Big without "degree" constraints. Second, many people are paralyzed by the convenience of consumer credit. Especially when credit card management and personal credit ratings are not yet sound, the joy of consumption and the penalty of overspending occur out of sync, and even the intensity is asymmetric. This will encourage many people to engage in advanced consumption with a "speculative" mentality. As a result, when this kind of problem breaks out due to the collective force of society, the social losses it causes are immeasurable. The Korean credit card crisis that broke out at the end of 2003 should be our best negative teaching material. Third, the asymmetry of rights and obligations in advance consumption makes it more difficult to constrain “degree”. For example, a house buyer tries his best to spend high-end in order to please the owner of the property, while the owner only considers whether he owns part of the property and relaxes the "degree" restriction on the buyer's advanced consumption. As a result, this kind of vanity satisfaction Excessive consumption behavior makes house buyers themselves become "housing slaves". The fourth is that they regard the real estate boom as a permanent phenomenon and invest in real estate beyond their financial capabilities. As a result, they are burdened with heavy debt burdens due to changes in macroeconomic control or business cycles, or the implementation of real estate investment supervision. . Fifth, they believe that excessive consumption has become a social trend. The risk of future income is not an individual risk, but a risk to society as a whole. Therefore, if something goes wrong, the country will definitely not stand idly by. As a result, advanced consumption that follows the trend abounds. Now this moral hazard behavior has begun to damage the stability of China's financial system. In this sense, the importance of establishing a good sense of social integrity is increasing day by day.
2. Opportunities and challenges brought by consumer credit business to China’s banking industry.
Since my country’s accession to the World Trade Organization on December 11, 2001, China’s economy has entered a new round of strong growth. According to relevant research from the Nielsen Report, an authoritative magazine on the international bank card industry, when the per capita income of a country or region reaches US$1,900, residents have reached the income critical point for credit consumption. A 2003 World Bank research report showed that at that time, there were at least 16 cities and 1 province in China where the income level of about 156 million people had reached US$2,000. In this sense, the phenomenon of "house slaves", "car slaves" and "card slaves" should not appear in these cities, unless it is caused by unnecessary mental energy and conflicts with one's own social values. .
In fact, since 1997, my country's personal credit business has developed rapidly, and its total scale has continued to expand. By the end of 2004, the scale of personal loans in China had grown from 18 billion yuan in 1997 to 2,209.3 billion yuan by the end of 2004, an increase of more than 120 times in seven years, with an average growth rate of over 90%. Not only that, the proportion of personal credit in my country to the total domestic and foreign currency loans of all financial institutions has increased year by year, from 0.23 in 1997 to 10.64 in 2004. Moreover, during these seven years, the average proportion of housing loans in consumer credit in our country exceeded 75%. With the continuous development of the economy, credit card loans are not to be outdone. Nowadays, credit card consumption is becoming more and more popular. Since it is difficult to accurately count the number of credit card credit balances, it can only be analyzed based on the number of cards issued. By the end of 2004, the total number of cards issued in my country's bank card market exceeded 800 million, with a year-on-year growth rate of 25%, of which more than 10 million recyclable credit cards were issued, with a year-on-year growth rate of 100%. Although the amount of credit card consumption is very small, according to the prediction of the internationally renowned investment bank Goldman Sachs, China's credit card credit balance will reach 70 billion to 80 billion yuan in 2006, and interest income will reach 14 billion yuan.
Why do Chinese banks pay attention to and value consumer credit business at the same time? The main reasons lie in the following points: First, China's economy is in the process of transformation, and there are still many uncertain factors in the future. In addition, banks are working hard to improve their financial conditions. Therefore, in addition to protecting large enterprises and state-owned enterprises, " Except for "safe" high-quality customers, banks have no incentive to develop new corporate credit business; secondly, China's economy has experienced structural imbalances such as overheating investment and excessive dependence on foreign economies. Corporate performance has also been affected by excessive competition and the external environment. coupled with the macro tightening policy, banks have no incentive to increase the scale of loans to enterprises; third, there is currently excess internal liquidity in banks. In order to balance the level of assets and liabilities, banks must develop new asset operations Business, compared with larger corporate credit, consumer credit risks are smaller, and the potential market is large, so the rapid growth of consumer credit business in the banking industry is understandable; fourth, in the transition to join the World Trade Organization As the end of the period marks the end of the period, China's financial market will enter a new stage of opening up to the outside world in 2007. The competition for high-quality bank business will become more intense. Therefore, it is reasonable to compete for the consumer market before then; Fifth, with the financial globalization and technology With the continuous deepening of innovation, the demand and supply of consumer credit have developed by leaps and bounds, which has also laid a solid foundation for banks to develop consumer credit business.
However, there are still many issues worthy of discussion in banks’ understanding and management of consumer credit risks. First of all, the lack of a personal credit evaluation system will create potential risks for this business. Although in times of economic prosperity, the behavior of excessive consumption will not affect the household's monthly mortgage payment to the bank, but when this type of excessive consumption becomes a social fashion, then once everyone's payment is negatively affected at the same time, it is easy to A credit card crisis like that in South Korea will affect the stability of the entire financial system. Secondly, even if banks use their professional capabilities in consumer credit contracts to transfer all risks, once the borrower's default behavior becomes a common phenomenon in society, no matter how perfect the loan contract is, it will be a piece of paper. Therefore, banks’ short-sighted behavior of eager for quick success is also one of the reasons why some consumers today have become “house slaves”, “car slaves” and “card slaves”. It is urgent to monitor excessive consumption behavior and educate consumers about credit risks as soon as possible.
3. Domestic demand-driven policies that stimulate consumption may not necessarily promote economic growth.
Some economists believe that an important reason for China’s excessive savings and cold domestic demand is that our country lacks consumer credit services and cannot fully utilize idle funds and allow more people to Chinese consumers go and enjoy the lifestyle of American old ladies. On the other hand, they believe that without the development of personal credit business, domestic demand cannot be promoted in this way, thereby improving the performance of my country's banks and enterprises and achieving a virtuous cycle for the economy. However, today's increasing social phenomena of "house slaves", "car slaves" and "card slaves" tell us that this idea is flawed.
First, consumption levels that exceed consumers’ own income capacity may lead to even lower domestic demand. Because people are in debt, they may become more frugal, so the overall level of consumption may not necessarily improve due to the development of consumer credit. Therefore, the direct effect of consumer credit on stimulating the economy is limited, let alone the indirect effect of improving people's income.
Second, even if the consumer credit business generates domestic demand, the demand may be transferred abroad because Chinese companies lack the competitiveness of their products, thus failing to stimulate my country's economic growth. On the contrary, the abuse of consumer credit business can bring about the phenomenon of "money illusion" and lead to false prosperity.
Third, China’s overall savings surplus does not reflect the enhanced earning capacity of Chinese residents as a whole. Statistics at the end of 2006 show that although China's economic growth scale (gross domestic product) has reached the fourth place in the world, its per capita income level is less than 1/4 of the world average, ranking around 110th.
The concept of developing consumer credit business and domestic demand to promote economic growth too quickly is not in line with China's current national conditions. On the contrary, excessive "stimulation" of domestic demand will bring about more serious "house slaves", "car slaves" and "card slaves" question.
Fourth, macroeconomic policies aimed at stimulating domestic demand may not necessarily stimulate high-income consumer groups to rely on Chinese products. Today, China's economy still has serious polarization between rich and poor and regional income gaps. The high-consuming class that can really drive domestic demand has reached the level of daily consumption they need, while the class with very low income levels cannot become the driving force for China's economy. the main force of consumption. In order to arouse the consumption of high-income people, in addition to improving the convenience of consumer payment, it is more important to have high value-added products. For China, supply-side strengthening policies (improving the efficiency of corporate loans) appear to be more reasonable, safer, and more creative than promoting domestic demand (excessive efforts to develop and compete for consumer credit markets). In this sense, the formation of the consumption pattern of Chinese old ladies is not caused by the constraints of the domestic financial environment, but is determined by the historical stage of China's economic development.
In short, China’s current reform focus, whether in the real economy or the financial economy, should focus on structural adjustment to bring it into balance. Any single and rapid pursuit of "fashion" will not help; doing it too hastily will breed modern diseases such as "house slaves", "car slaves" and "card slaves", making us pay unnecessary social costs for this. The cost of welfare loss. Especially when we are vigorously promoting the development of consumer credit business, we should establish the necessary social responsibility, correct consumption and credit ethics, and supporting operating systems and supervision systems in all links and among all parties.