Research On Legal Regulation Of Consumer Over-indebtedness

While a thriving consumer credit market drives economic development,it inevitably leads to irresponsible lending and consumer over-indebtedness.Consumer Over-indebtedness not only affects consumers’ personal interests,but also the safety and stability of the society.Therefore,strengthening the legal regulation is an important part of the mechanism to prevent and resolve financial risks.Through comparative analysis,literature analysis and other methods,based on the basic theory of legal regulation of consumer over-indebtedness,this thesis summarizes measures on financial consumer protection in several developed countries,and proposes recommendations for the legal regulation of consumer over-indebtedness in China.Besides the introduction and conclusion,the thesis is divided into four parts.The first part researches the fundamental theory of legal regulation of consumer over-indebtedness,which consists of the definition,the causes,the necessities,and the basic institutions.Preventing consumer over-indebtedness is not only the need to protect the legitimate rights and interests of financial consumers,but also the need to safeguard financial security and promote the orderly development of the credit market.Consumer over-indebtedness may be caused by irresponsible lending or inadequate disclosure of information,or by their own reasons,such as insufficient financial knowledge and the consumerism.Therefore,responsible lending system,credit system,information disclosure system,financial education system,and debt settlement system are the main systems to regulate the problem of consumer over-indebtedness.The second part debates the present situations of legal regulation of consumer over-indebtedness in China.For the past few years,China’s consumer credit market has gradually developed in an orderly and healthy way,the degree of financial product inclusion has increased significantly,and the financial consumer protection system has been initially constituted.However,compared with developed countries,China’s financial consumer protection legislation is not very effective;China’s behavioral regulator hasn’t been established;China’s consumer credit data is not enough to use;China’s financial education is not being taken seriously;penalties for inappropriate financial marketing practices are weak;and remedies for consumer over-indebtedness are lacking.The third part analyzes the experience of major overseas economies in regulating over-indebtedness.By analyzing the specific systems of regulating consumer over-indebtedness in developed areas such as England,America and Japan,we can infer that these countries have the following characteristics in regulating consumer over-indebtedness: concentrate on the construction of the basic legal system for financial consumer protection;establish a clear conduct regulator;promote the sharing of consumer credit data;Strengthen regulation of financial marketing practices;concentrate on consumer financial literacy education;and improve the remedies for consumer over-indebtedness.The fourth part draws on international experience in the legal regulation of consumer over-indebtedness and proposes suggestions for perfecting legal regulation of consumer over-indebtedness in China.To be more specific,China should build a responsible lending system and strengthen financial consumer protection: Most important of all,legislate the law on financial consumer protection,establish the principle of preventing consumers from over-indebtedness;second,establish a clear conduct regulator to strictly supervise the irresponsible lending practices;and third,the government should take the lead in establishing a market-oriented credit system;fourth,strengthen consumer financial education and build a national strategy for financial education;moreover,strictly regulate financial advertising and make penalties more severe;last but not least,establish a consumer over-indebtedness relief system and improve alternative dispute resolution mechanisms for over-indebtedness.