Mainland consumer loans with annualized interest rates falling below 3% are urgently suspended, sparking discussions.

In recent times, various banks in mainland China have significantly lowered the interest rates on consumer loan products, with products featuring annual interest rates below 3%, attracting market attention. However, just over a week later, regulatory authorities swiftly intervened and halted this practice. It has been reported that several banks have received notices from regulatory authorities instructing them to suspend the approval of consumer loan products with annual interest rates below 3% starting from April 1st. Some bank employees have expressed concerns that if consumer loan interest rates rise above 3%, the performance of consumer loans may suffer. It is worth noting that many banks are still trying to seize the opportunity to attract customers, but they are worried about the increasing pressure on future loan approvals.

Several state-owned banks, joint-stock commercial banks, and local branches of urban and rural commercial banks have been instructed to suspend the issuance of consumer loan products with interest rates below 3% starting from April 1st. This information was revealed by credit managers at these financial institutions.

Over a period of time, the interest rates on consumer loans offered by banks have continuously decreased. According to media reports, some banks have been offering consumer loan products with annual interest rates below 2.5%.

Many customers who have applied for consumer loans have already received notifications and have been sharing this information on social media platforms. Users who have successfully applied for loans but have yet to withdraw the funds mentioned that bank managers are asking them to complete the withdrawal process before April 1st; otherwise, the previously offered incentives may be withdrawn.

According to reports from financial news outlets, the banking industry has indeed received relevant requests from regulatory departments recently. However, on March 31st, many credit personnel at banks accelerated their efforts to attract customers by advertising promotions such as the “last day of low interest rates.” They urged customers to quickly assess their credit limits and withdraw funds using the interest rate coupons before April 1st. Journalists from a financial news outlet also received sales calls from a bank on the same day, where the bank representative highlighted the current low interest rates and encouraged customers to deposit funds into their accounts for future use.

Many credit personnel at banks are worried that an increase in interest rates on consumer loans could lead to a decrease in consumer interest, further exacerbating the pressure on loan approvals.

A bank employee mentioned that consumers are currently very sensitive to loan prices, with a relatively weak willingness to borrow, leading to significant pressure on loan approvals. If consumer loan interest rates exceed 3%, it is possible that consumer loan performance may be significantly affected in April.

Recent data shows that the pressure on retail banking has been increasing in recent years. The 2024 annual report of China Merchants Bank revealed a decrease in the scale of both consumer loans and operation loans by 706.28 billion yuan and 833.58 billion yuan respectively compared to the previous year.

According to a report from “China News Service,” an employee from a branch of a joint-stock bank in the eastern region of China mentioned that March 31st was the last day of the quarter, prompting them to intensify marketing efforts. The 2.58% interest rate coupons previously issued to customers also expired on that day, signifying that interest rates below 3% would no longer be available from April 1st onwards.

Furthermore, a customer manager at a branch of a city commercial bank in Beijing stated that the personal consumer loan interest rates at their bank have been adjusted to above 3%.

Regulatory authorities swiftly halting the issuance of consumer loan products with annual interest rates below 3% has sparked discussions among internet users.

One netizen, 0sIoH_, expressed confusion, stating: “The reduction in consumer loan interest rates was just introduced, and it was stopped after only a few days… What’s going on?”

Another netizen, 151E0g, pointed out: “The real estate market is also a form of consumption.”

A user named Deep Factory Manager raised concerns, suggesting: “Borrowing consumer loans to repay housing loans in advance will spell doom for banks.”