Where is the marketing boundary of financial products?, Live streaming "loan" products stall after a brief outbreak | loan | boundary
"50% off coupon on first-time interest for new customers", "link on countdown, no manual delay" In June, many banks flocked to live stream their loan products, attracting market attention. Last week, regulation had already intervened. According to market news, the former Risk Disposal Bureau of the China Banking and Insurance Regulatory Commission issued a notice to banks on conducting research on the sales of online live streaming, focusing mainly on the sales of online live streaming by banks since 2021.
Currently, banks are turning off their loan related live broadcasts on various platforms. On the live streaming page of a mainstream platform, First Financial reporters searched for keywords such as "loan", "interest", "bank", but were unable to find the corresponding content. Industry insiders believe that as a franchising industry, the financial industry needs to clarify boundaries and prevent behaviors such as exaggerated advertising and misleading consumers in order to increase performance through live streaming and other marketing methods.
Loan live broadcasts are turning off one after another
Previously, multiple institutions such as Online Commercial Bank, WeBank, Ningbo Bank, and CITIC Bank have tested loan marketing live broadcasts, attracting consumers with low interest rates, high credit limits, and interest free periods in their live broadcast themes. The promotion of discounts such as "new customer discount interest rate of 3.6%", "maximum interest free for 10 days", and "maximum increase to 3 million yuan", combined with the atmosphere of limited time rush buying in the live broadcast room, once attracted market attention.
But in June, the live streaming of bank loan products suddenly turned off after entering its peak period. Taking the online commercial bank with relatively dense live streaming frequency as an example, its live streaming account has been live streaming since March this year. It has conducted a total of 84 live broadcasts on a mainstream platform, with 31 live broadcasts in June alone. After June 27th, the live streaming has been suspended.
The relevant loan accounts of Ningbo Bank started earlier and started trial broadcasting in December last year. In mid May this year, the bank began using advertising slogans such as "maximum quota of 200000 yuan" and "fixed annualized interest rate of 3.6%" in a live broadcast room on a certain platform. From May 5th to June 15th, the bank conducted a dense 40 live broadcasts, and the broadcasts were suspended after June 21st.
In addition to the aforementioned banks, WeBank and CITIC Bank have also suspended or weakened the live streaming of loan related products in July.
It is worth noting that there was a certain degree of exaggeration in the previous live broadcasts of such loans. For example, in the live broadcast of an Internet bank, the background map of the live broadcast room marked "Click the card below, and the maximum increase will be 3 million yuan." But after the retention of funds, the customer service of the bank introduced that only qualified customers can increase the amount, and the increase of the amount to 3 million yuan is required to meet many hard thresholds.
In addition, the reporter found that some banks usually extensively introduce preferential interest rates in their live broadcast rooms, but rarely involve situations that meet borrowing conditions and can achieve expected interest rates. Taking a loan product launched by a commercial bank in a certain city as an example, the gimmick in the live broadcast room is "new customers with an annualized interest rate of 3.6%". However, in its promotional materials, it is only indicated in small font at the end of the page that the annualized interest rate is between 3.98% and 15%. In July, new customers will receive a fixed interest rate coupon of 3.6%.
"Most of the discounts in live streaming rooms are packaged as gimmicks." An insider from a bank's live streaming line pointed out that if a bank wants to "run a lot" in live streaming, the key to attracting attention is low interest loan products and high-density lucky bag gift distribution. However, it is currently difficult to lower bank loan interest rates universally, and various means can only be used to "package" discounts and attract customers to leave their contact information first.
From the current perspective, this model has achieved certain results in loan disbursement. The person in charge of the bank's live streaming line mentioned above explained that although currently, from the perspective of average customer value, it is similar to directly advertising on third-party platforms before. But there are many hidden customers who choose not to leave a phone number directly in the live broadcast link, but will inquire about loan matters through private message customer service, phone calls to banks, and other means.
However, he also admitted that due to the logic of live streaming being to attract customers with various promotional gimmicks, the effective conversion rate of customers is relatively low. Although most people have intentions, there are relatively few who have passed the qualification review, and the actual impact on the banking business side is not significant for the time being. Due to regulatory reasons, many banks that had previously attempted loan live streaming have chosen to temporarily suspend their operations internally.
Consumer loan price war "internal competition" channels
It is not an accidental phenomenon for banks to cluster together for loan live streaming. During the June sprint towards quarterly indicators, the offline bank consumer loan price war had already led to new low interest rates. For example, a certain joint-stock bank launched the "Lightning Loan 6.8% Off Mid year Promotion" activity, during which new customers who successfully established their accounts can enjoy a discount of 6.8% off interest rates, with the lowest interest rate being as low as 3.4%. The "Huimin Loan Mid Year Celebration Event" launched by a state-owned large bank in June allows high-quality units and new customers with newly approved amounts to receive a 3.24% annual withdrawal interest rate coupon.
Some industry insiders believe that loan live streaming is actually a further "involution" of the consumer loan price war mentioned above: in addition to starting the price war, banks also try to "involute" channels through live streaming and other means, using online discounts to reach more customers. However, currently the net interest margin of commercial banks has reached a historic low, making it difficult to sustain the loan side's "price for quantity" model of attracting customers.
Recently, the Global Banking Outlook Report released by the Bank of China Research Institute predicts that the net interest margin for the first half of this year, the first three quarters, and the full year will be 1.74%, 1.73%, and 1.73%, respectively. Previously, the State Administration for Financial Regulation released a table of major regulatory indicators for the banking industry in the first quarter, which also showed that the net interest margin in the first quarter was 1.74%, a decrease of 0.17 percentage points from 1.91% in the fourth quarter of 2022, setting a new historical low.
It is worth noting that the above indicators and predictive indicators are lower than the rating standard of "no less than 1.8%" proposed in the Implementation Measures for Qualified Prudent Assessment.
Among them, the decrease in net interest margin in the first quarter is largely related to the significant increase in credit and the decline in interest rates. According to central bank data, RMB loans increased by 10.6 trillion yuan in the first quarter, an increase of 2.27 trillion yuan year-on-year. The weighted average interest rate for newly issued corporate loans in March was 3.95%, a decrease of 0.41 percentage points compared to the same period last year and a decrease of 0.02 percentage points compared to the previous year; The weighted average interest rate for personal housing loans is 4.14%, a decrease of 1.35 percentage points compared to the same period last year and a decrease of 0.12 percentage points compared to the previous year.
Regulatory investigation of risks
As a franchising industry, can loan live streaming be included in new marketing channels in finance now, and where should its boundaries lie? Zhou Yiqin, founder of Guantiao Consulting and senior financial regulatory policy expert, told First Financial reporters that the method of live streaming loans is worth exploring, but it should be included in the compliance and consumer protection system for regulation. If there are problems of improper marketing and exaggerated promotion in live streaming, it is easy to infringe on the right to know of financial consumers, leading to irrational borrowing and other problems. For local corporate banks, it is also a question whether it belongs to the national exhibition industry if they broadcast their products through the Internet platform.
Regulatory agencies have intervened in response to the above phenomenon. It is reported that on July 4th, the Risk Disposal Bureau of the former China Banking and Insurance Regulatory Commission issued a notice to various banks on conducting research on the sales situation of online live streaming, intending to conduct written research on the sales situation of online live streaming and past complaints and disputes of banks since 2021, including seven major issues: the business processing process of online live streaming sales, risk management measures such as customer qualification review, and violations by qualified entities.
In fact, as early as 2020, some financial institutions also conducted online live streaming in clusters. The former China Banking and Insurance Regulatory Commission issued a "Notice on Preventing Risks Related to Financial Live Streaming" in response to this phenomenon, pointing out that such live streaming poses two main risks: confusion of financial live streaming marketing entities or hidden fraud risks, and sales misleading risks in live streaming marketing behavior. In terms of sales misleading, emphasis was placed on multiple issues such as false or exaggerated advertising, concept swapping, simple price comparisons, information disclosure, and inadequate risk disclosure or warning.
Can the live streaming model be replicated and promoted in the financial field in the future? Zhou Yiqin believes that live streaming, an emerging promotional model, has proven to be successful in the traditional commodity field. But from the previous attitude of regulation, it is not advocated. For example, in 2021, the regulatory authorities promptly stopped Internet deposits, explicitly requiring commercial banks not to carry out marketing campaigns for time deposits and flexible deposits through non proprietary network platforms.
Zhou Yiqin further explained that the main reasons for this are two aspects. Firstly, financial products are special commodities, and from the perspective of consumer protection, the connection between financial products and individual customers is close. If there are problems such as improper marketing and exaggerated promotion, the impact on customers is much greater than that of traditional products; Second, the financial industry is a franchising industry, and different types of banks have regional restrictions on their operations. From the regulatory perspective, if local corporate banks achieve essentially national operations through the Internet, they will not only bypass the regional administrative licensing restrictions, but also deviate from the local service orientation.
