The Status Quo Of China's Credit Risk Management And Countermeasures

Recently, card business has been rapidly developed in China's banks, among which credit card business is the most potential one. With the gradual improvement of the domestic credit system and the increasingly identification of paying by card, the credit card market has become the white-hot field for commercial banks. Thus, the banks invest more and more both human resources and capitals in the credit card market. Consequently, credit card has deeply affected the lives of the Chinese people and plays an increasingly important role as a good partner of people's daily life. However, along with the rapid development of credit cards and the growth of the credit card number, the risk of card business has increased. Therefore, it is essential to enhance the profitability of commercial banks that focusing on the study of credit risk management.This paper finds some existing problems in the risk management of China's credit card market, based on the development status of China's credit cards and relative risk management in recent years. These problems are as follows. Firstly, the consciousness of risk needs to be further improved for all the stakeholders; Secondly, Marketing strategy has not been considered together with risk factors; Thirdly, the update for risk management information delays; Fourthly, it is not sufficient that the efficient and smooth risk information sharing mechanism; In addition, risk control level is relatively low, and risk management experience is not enough.Accumulation as well as mutual penetration of these issues will greatly enhance the difficulty of credit risk management. In all, these problems will lead to credit risk, fraud risk and operational risk.In this paper, these types of risk, are given specific risk management measures. Credit risk management, proposed the establishment of individual credit information system from; through the combination of qualitative and quantitative methods of credit review; perfect credit card management system; moral and legal dual checking, Zengqiang cardholders credit awareness and credit card outsourcing services by enhancing the development of several aspects of core business credit card to prevent. For fraud risk management, following strategies are suggested: strengthening the internal management of issuers; increasing scientific and technological input; strengthening the education for cardholders; regulating the behavior of the merchant staff and creating long-term mechanism including training, rewards and punishments; the establishment of completed legal system and focusing on credit card fraud. Operational risk management could be diluted by strengthening the internal control of banks, standardizing the operating procedures, speeding up the construction of management information systems, enhancing the training of practitioners, building professional counseling teams and purchasing insurance products.