Financial Supervision and Administration Bureau and People's Bank of China Jointly Release "Provisions on Explicit Comprehensive Financing Cost Disclosure for Personal Loan Business" Clarifying Interest and Fee Information Disclosure for Personal Loan Business

Our reporter Liu Qi

According to the website of the National Financial Regulatory Administration (hereinafter referred to as “Financial Regulatory Administration”) on March 15, to maintain order in the personal loan market, protect the legitimate rights and interests of financial consumers, and improve the quality and efficiency of financial services, the Financial Regulatory Administration and the People’s Bank of China jointly issued the “Regulations on Clear Disclosure of Comprehensive Financing Costs for Personal Loan Business” (hereinafter referred to as “Regulations”), which will take effect on August 1, 2026.

“In recent years, China’s personal loan market has developed rapidly, playing a positive role in promoting personal consumption, production, and steady, healthy economic growth,” said officials from the Financial Regulatory Administration and the People’s Bank of China. At the same time, issues such as irregularities and lack of transparency in the disclosure of interest and fee information for personal loans have emerged, which can easily lead to financial consumer disputes, affect the effectiveness of interest rate policies, and weaken the quality and efficiency of financial services to the real economy. It is necessary to formulate and implement relevant regulatory rules to clarify the scope, operational methods, and procedures of interest and fee disclosures, define responsibilities of all parties, better protect the legitimate rights and interests of financial consumers, facilitate the transmission of financial policies benefiting the people, and promote industry regulation and healthy development.

The “Regulations” consist of 11 articles. Within the existing framework of loan information disclosure regulation, they specify the scope, operational methods, and procedures for disclosing interest and fee information for personal loans, requiring lenders to present a clear comprehensive financing cost disclosure form, transparently disclose the interest and fee costs of personal loans, and effectively implement the disclosure requirements.

To accurately and comprehensively reflect the actual financing costs borne by borrowers in personal loan transactions, the Regulations include all costs related to personal loans into the comprehensive financing cost, including but not limited to loan interest, installment fees, credit enhancement service fees, and other financing costs under normal performance, as well as potential costs such as overdue penalty interest in case of default. Borrowers should pay attention to the comprehensive financing costs when applying for personal loans, fully understand the items, collection methods, standards, annualized rates, collection entities, and default responsibilities related to financing costs.

The Regulations require that, for on-site personal loan transactions, borrowers must sign and confirm the comprehensive financing cost disclosure form before signing the loan contract or initiating installment payments. For online personal loan transactions, the comprehensive financing cost disclosure form must be displayed to borrowers via a pop-up window, with a mandatory reading period, and confirmed by the borrower before signing the loan contract or initiating installments. In online consumption scenarios involving installment payments, the relevant information must be clearly displayed in a prominent manner on the payment page of the order.

The comprehensive financing cost disclosure form should specify the principal amount of the loan, itemize each interest and fee charged by the lender and its partners, including collection methods, standards, and collection entities, and calculate the annualized comprehensive financing cost for normal performance. It should also itemize potential costs and their standards and collection entities in cases of default, such as overdue or misappropriation.

In online consumption scenarios involving installment payments, the payment page must prominently display the principal amount, installment arrangements, service fees, collection entities, the annualized comprehensive financing cost borne by the borrower under normal performance, and potential costs and standards in default.

Both the comprehensive financing cost disclosure form and the payment page for installment payments in online scenarios must clearly indicate that, aside from the costs already disclosed, lenders and their partners will not charge any other interest or fee related to the loan.

The responsible officials stated: “To promote standardized operation of comprehensive financing cost disclosure, we have developed sample disclosure forms for comprehensive financing costs and sample pages for installment payments in online consumption scenarios. We will also guide industry associations such as the China Banking Association, the China Internet Finance Association, and the Market Interest Rate Pricing Self-Regulatory Mechanism to leverage industry self-discipline to support the implementation of these requirements.”

“Considering that lenders need to adjust business processes, systems, and modify cooperation agreements, the Regulations will be implemented from August 1, 2026. Relevant entities should prepare accordingly. When the Regulations come into effect, under the principle of ‘new and old’, new business activities must strictly follow the requirements for disclosing comprehensive financing costs,” the official added.

(Edited by Qian Xiaorui)

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