Zhang Jianhua: Prevent the financial industry from kicking the so-called ball into the judicial system and let the courts act as collection agencies

Zhang Jianhua, source: Sina Finance-Ruijian Economy

Zhang Jianhua: Prevent the financial industry from kicking the "so-called ball" into the judicial system and let the court act as a "collection agency"

On December 21, the "2023 Banking Industry Development Forum Digital Finance Conference" hosted by Sina Finance was held today, with the theme of "New Digital Trends, New Financial Missions". Zhang Jianhua, former director of the Research Bureau of the People's Bank of China and professor of PBC School of Finance of Tsinghua University, delivered a speech at the forum.

In his speech, Zhang Jianhua pointed out that to prevent the financial industry from kicking the so-called ball into the judicial system, let the court be our collection agency.

Zhang Jianhua said that small enterprises have a lot of inclusive business, and now the scale is getting bigger and bigger, digital technology allows us to serve more of these small enterprises, serve more individual customers, improve our coverage at the same time, improve the breadth of our services at the same time, in fact, there will be a certain customer sinking, the original long-tail customers have a lot of we have not tapped out, effective, reputable customers, the wider the customer coverage, the higher the default rate in the future. At present, the short-term consumer credit of the whole household accounts for 17% or 18%, and we are only talking about the consumption side. If you add the scale of inclusive business, it may be larger, if the loans issued through digital technology are estimated to be no less than 10 trillion yuan in the country, as well as the traditional credit card business, many credit card businesses are also oriented to individuals, and you can also see that the balance of inclusive loans is rising year by year, which shows that our current coverage, due to the development of our digital technology and the improvement of digital financial service capabilities, our coverage is getting wider and wider, but it has also brought some problems, that is, the problem of our non-performing assets。

Although the non-performing loan ratio itself has maintained a certain level in recent years, without too much rise and even one or two BP declines, in fact, we know that we look at the operation of the financial industry and the quality of assets. Dispose of it, because financial institutions still have post-loan disposal, once it doesn't work, into the non-performing, regulatory requirements, in order to maintain the balance sheet will be disposed of, written off or transferred, at present, this is higher than the 1% non-performing on the balance sheet.

Bank credit card data is publicly available, usually the incidence of non-performing rate is 4.5%-5%, but when you see the account sheet, it is about 2%, that is to say, the other parts are written off every year and disposed of every year, which is a large amount. As we all know, the disposal of assets in the financial industry is not gone after the write-off, we call the account write-off case, and the financial institutions still have to collect it, but the collection is now facing many problems. We talked about the Internet, credit cards, and online loans are the same, which is the largest amount of digital credit. The bad generation rate of different platforms is not the same, even if it is a good head platform, its bad rate is usually much higher than the bad rate reflected on the account sheet, in other words, the bad accumulation is a lot, and a large number of these accumulated bad are small, the amount is not large, the average balance of some online loans is only a few thousand yuan, more than one or two thousand yuan, and the loan balance of the credit card is the same, usually a few thousand yuan, one or two thousand yuan is considered high, so the traditional collection adopts internal collection, External outsourcing has brought some problems, such as irregular collection, some violent collection, and some irregular collection. At the same time, there is also an anti-collection alliance, which is a relatively big problem faced by financial institutions at present, some people whether they really have no money or fake no money, he knows that he owes money, but he finds all kinds of reasons and deliberately does not pay it back, which brings a lot of problems. Financial institutions have some problems whether they are self-urging or outsourcing, and if this is more standardized through judicial judgments, financial institutions can also deduct this part of the bad loans and write-offs before tax. One is to standardize, the other is to increase the intensity of collection, and the other is to deduct, but the collection of laws may bring great pressure to judicial resources.

After all, the number of courts is limited, and in the era of digital economy, the technology of digital finance must be solved by digital judicial means. In fact, as you know, many microloans are standardized. The contract text is standardized and the amount is small, so it can be applied to simple and fast procedures in judicial practice, especially with the improvement of artificial intelligence technology, if you read the legal text, artificial intelligence AI can do a lot of work for you, not how much manpower is required to do, the judicial environment must adapt to the digital economy, because the future must be the era of digital economy, the financial industry is just ahead, there are many small amounts, batches, only the protection of a good legal environment can finally promote the healthy development of our industry.

As you know, there are a lot of practices in the local area, and there are many grassroots courts that have already started to do it, but now they are also facing some problems. For example, if a case involving 1,000 people is counted as a case of 1,000 cases, the amount of litigation is particularly large for the courts, as if our country has become a big country in litigation, which is also not in line with our orientation of building a harmonious society. Illegal fundraising is also one-to-many, and it is not always so many cases to deal with in a lawsuit, so the question about the number of cases is the first.

The second is about the problem of manpower, which can be used by technical means and artificial intelligence, in order to prevent the tampering of data, we also have blockchain technology, which can ensure that all case information cannot be tampered with after being put on the chain, which is also a problem. In fact, we can do a lot of work ourselves, that is, we can do a lot of adjustment in the early stage, and we can take collection and adjustment as a precondition for the court to accept litigation. A lot of it can be solved by technical means, not once it is overdue, it will not be pushed to the court without collecting it, I think it can be done in some ways, we have a lot of technical means to deal with it.

Prevent the financial industry from kicking the so-called ball into the judicial system and let the courts act as our collection agencies. In fact, we can do a lot of work ourselves, and we can do a lot of adjustment in the early stage, and take collection and adjustment as a precondition for the court to accept the lawsuit. A lot of it can be solved by technical means, not once it is overdue, it will not be pushed to the court without collecting it, I think it can be done in some ways, we have a lot of technical means to deal with it.