With the rise of auto consumer finance, many banks have entered the market to seize the market through auto installment business. However, under the strict regulatory situation, some violations have surfaced. Since the end of last year, regulators have issued 10 fines against banks for violating the auto installment business. Analysts pointed out that because banks rely on auto dealers and guarantee companies and other subjects to obtain customers in bulk in the past, the lack of penetrating wind control of customers, resulting in risky events from time to time. In the future, banks should strengthen access requirements to control risks at the source.

Repeated fines

Under the strict regulatory situation, the bank's illegal car installment behavior "current". Xianning Banking and Insurance Supervision Branch recently announced the administrative penalty information, Agricultural Bank of China (情 601288 ,diagnostic shares ) Xianning Branch of the existence of automobile consumer installment business management is not due diligence behavior was fined 500,000 yuan, at the same time, the bank's three related personnel were fined a total of 130,000 yuan.

In addition to the Agricultural Bank of China Xianning branch to receive punishment, the recent Industrial and Commercial Bank of China (情 601398 ,diagnostic shares) 9 branches or sub-branches are also in the business of the penalty. January 30, according to the Yiyang Banking and Insurance Supervision Branch disclosure of the fine sheet shows that the Industrial and Commercial Bank of China Yiyang Yincheng sub-branch due to illegal and illegal to open the automobile credit card special installment business was fined 200,000 yuan. On the same day, Hengyang Banking and Insurance Supervision Bureau of ICBC Hengyang Branch **** 24 people in charge of making penalties, the reason for the penalty is that "the ICBC Hengyang Branch of the violation of false car installment business, St. Mou cheating loan case and other violations of the direct responsibility". Two of them received a lifetime ban on the "top penalty", 5 people were sentenced to three or five years prohibited from engaging in the banking industry, 1 person was disqualified for three years, 17 people were given a fine or a warning.

It is understood that from December 29, 2018, ICBC Xiangtan Branch, Zhuzhou Branch, Changde Branch, Changsha Branch, Hengyang Branch, Yongzhou Branch, Loudi Branch, Chenzhou Branch and other institutions were fined for automotive installment business violations, a total of up to 4.16 million yuan in fines, and the directly responsible person **** counted 54 people. Among them, seven organizations were fined for "false business" or "no real car purchase transactions".

In this regard, Sacks Institute senior researcher Su Xiaorui said, behind these fines reflects the bank's internal control problems, insufficient attention to the risk of credit card auto installment business, the cooperation of car dealers to control laxity, etc.

For more information, please visit the website of the Sacks Institute.

For a number of branches of the violation of the new behavior, the relevant person in charge of the Industrial and Commercial Bank Peony Card Center responded in an interview with a reporter from the Beijing Business Daily that the irregularities in the handling of automobile installment business by some branches of the Hunan branch occurred before 2017. The branch has been rectified in accordance with the requirements of the regulatory authorities and the head office, and the relevant responsible persons have been dealt with.

Cooperation model buried hidden danger

In the view of analysts, the repeated violations of the auto installment business are related to the customer acquisition model of the business.

It is understood that, according to the purchase of a car whether the user direct contact with the bank personnel, the bank car installment business is divided into direct customer type and between customer type two. In the "direct customer" mode, the borrower needs to go through the bank's examination and approval before being able to contact the car dealers in the subsequent links; and the "inter-customer" mode, the car dealers as an intermediary, almost all the agents Loan, repayment of the various procedures, the process of which the bank is less involved in the process. The fact is that the bank's involvement in the process is low, which indirectly creates a loophole for irregularities.

Zhao Yiyang, a senior researcher at the Suning Financial Research Institute, pointed out that many banks have recently been penalized for automotive installment business violations, mainly due to the banks' reliance on guarantee companies, credit insurance agencies, and platforms and other main bulk customer acquisition, and the lack of penetrative wind control of installment customers, resulting in the risk of jeopardizing the rights and interests of financial consumers, such as loan sharks.

In the opinion of Yu Baicheng, president of Zero-One Research Institute, banks carry out automobile consumer installment business mainly in the form of credit card installment, which has a long repayment cycle and large amount, and generally needs to cooperate with auto dealers and guarantee companies. If the process is not standardized, there may be improper review of the information of the partners, and even the case of false business.

Multi-channel risk control

The recent phenomenon of banks being penalized repeatedly for auto installment triggered market concern.

The relevant person in charge of ICBC Peony Card Center told Beijing Business News that in order to further strengthen the management of auto installment business, the bank continues to improve the system, optimize the system, and use big data to enhance the risk control capability. At present, automatic verification of purchased vehicle invoices and insurance policy information has been realized. At the same time, it is required to implement vehicle collateral and vehicle verification on a case-by-case basis to provide customers with high-quality and efficient automotive financial services on the basis of effective risk prevention and control.

Analysts pointed out that commercial banks should strengthen the supervision of automobile installment in the future to form an effective deterrent to avoid the emergence of regional systemic risk. Zhao Yiyang analyzed that the introduction of third-party institutions, easing the bank's credit risk, originally belongs to the normal business model, but if due to the intervention of the third-party institutions, negligence of the full understanding of the customer, there may be a set of loans or concentration of fraudulent loan risk, so the supervision should focus on the risk of this type of business situation.

Controlling risks at the source and improving the relevant system construction is also an effective way to avoid risks. Yu Baicheng said that banks should strengthen the access requirements for partners when carrying out this kind of business, such as strengthening the audit of installment users, strengthening the risk control process, and preventing the risks of high-debt users, multiple borrowing and fraudulent lending.

In addition, the bank should also strengthen the full review of various types of customer information. In Su Xiaorui's opinion, on the one hand, the bank should improve the customer identity authentication system, seriously implement the "three personally see" and other customer survey process, to ensure that the customer himself to apply, to avoid the existence of identity theft and other false business existence. On the other hand, banks also need to carry out investigations of the customer's occupation, income, assets and other key information, for the qualification does not meet the entry requirements, attempts to apply for borrowers through illegal and unlawful methods resolutely rejected.