Banks told to strengthen oversight of credit card delinquencies

The Shanghai office of China's banking regulator asked commercial banks to improve their oversight of credit card delinquencies in a bid to better regulate the market as well as to protect consumers.

The China Banking Regulatory Commission Shanghai Office said some banks didn't fulfill their obligation to inform credit card users of liability for malicious overdrafts. Some also were deficient in maintaining evidence during the payment collection process.

The local regulator said the notice it issued recently was for consumer protection, payment collection regulation, and raising legal and compliance awareness.

Banks should remind card holders that making repayments on past-due bills will exempt them from criminal liability, in order to minimize the negative impacts on the users and their families, and to maintain social harmony and stability, said the CBRC Shanghai office.

Banks also need to improve their oversight of payment collections and standardize outsourcing to collection agencies.