Focus on "Total Financing Cost," new personal loan regulations directly address the chaos of "loan shark" schemes

According to Nandu, the State Financial Supervision and Administration Bureau and the People’s Bank of China recently issued the “Regulations on Clear Disclosure of Comprehensive Financing Costs for Personal Loan Business” ( hereinafter referred to as the “New Personal Loan Regulations” ), aiming to address the issues of non-standard and non-transparent disclosure of interest and fee information in personal loan services, and better protect the legitimate rights and interests of financial consumers. The regulation will come into effect on August 1 this year.

The “New Personal Loan Regulations” make an important breakthrough: requiring financial institutions to clearly disclose the “comprehensive financing cost” to consumers and to inform them through pop-up mandatory reading prompts. This means that the past chaos of “interest rates that don’t seem high, but the total fees add up to terrifying amounts” will be strictly regulated.

This new regulation targets a stubborn problem in the recent lending industry, namely the use of various “service fees,” “guarantee fees,” “membership fees,” and other charges to conceal the true cost of funds. The regulatory approach is very clear: a loan is a loan, and all costs should be laid out transparently so that consumers can see clearly and understand fully.

Nandu’s report exposes many tricks. For example, some users purchase a 3,408 yuan travel card on the platform that needs to be repaid within 15 days, but the actual amount received is only 2,500 yuan. There are also users who report using platform credit to buy a 2,688 yuan payment red envelope and a 688 yuan so-called travel voucher, but only 2,000 yuan of the payment red envelope can actually be used. These platform practices show obvious characteristics of usury and high-interest lending.

Some platforms seek high returns through “physical item recycling” operations. On one platform, an Apple 256G 16 Pro phone is priced at 12,638 yuan, which is 3,600 yuan higher than the official website price. After paying a 400 yuan fee, users can buy the phone with zero down payment and installment, then resell it to others at a low price of 6,100 yuan. After deducting fees, they actually receive 5,700 yuan. By setting a “high and low” price, the platform avoids regulatory constraints, but the actual loan cost is staggering: the loan repayment period is only two months, with an actual amount received of 5,700 yuan and a debt of 12,638 yuan. Calculated annually, this loan’s interest rate reaches as high as 730.31%.

Similar installment mall platforms are hotspots of current lending chaos. To seek high returns, these platforms set up intermediary products, such as virtual goods like gift cards or popular, easily tradable physical items like Apple phones, charging fees at multiple stages to evade current regulatory policies.

Therefore, regulators cannot only focus on the “loan” label but must also penetrate the disguises of “travel cards,” “membership fees,” and “shopping credits.” From the perspective that “substance takes precedence over form,” they need to judge whether a transaction is truly a “consumption” or a “loan.”

“Consumer education” has always been regarded as an important part of protecting consumer rights. Regulatory authorities hope to promote financial literacy so that consumers can identify risks and avoid traps. But are these violations really that hidden? A “travel card” that must be repaid within 15 days, with actual funds received far below face value—just think with common sense, isn’t this high-interest lending? Why do so many consumers still rush in?

On one hand, these platforms are indeed cunning, exploiting legal loopholes and making it difficult for consumers to defend themselves. But on the other hand, it must also be acknowledged that some consumers are not entirely “uninformed.” Instead, driven by urgent financial needs, they choose to “take the money first and worry about the rest later.” Knowing it’s high-interest lending, they still hold the hope that “just a few days of borrowing, the interest won’t be that high.” Knowing that buying a travel card is a sham, they think, “as long as I can borrow money, I can buy anything.” This mindset is precisely the soil in which these platforms survive.

Ultimately, the sense of security in financial consumption requires the coordination of financial regulation and market regulation, technological support, strengthened law enforcement, and most importantly, consumer awareness.