Study On The Legal Issues Of Tying Bank Loans:based On The Perspective Of Consumer Protection

Bank personal loans are the most familiar economic behavior of bank consumers,and they play an important role in facilitating financing and improving consumers’ purchasing power.However,commercial banks compel borrowers to accept other products or services from the bank or affiliated or associated institutions when processing personal loans,which seriously harms the interests of bank customers and the market economic order.From the 27 administrative punishments and related cases disclosed by the CBIRC,it is clear that tied sales of bank personal loans are still common in practice,mainly in the form of tied sales of insurance products,deposits,bank cards,wealth management products or commemorative coins;and tied sales of bank personal loans infringe on consumers’ legitimate rights and interests such as the right to know,the right to independent choice,the right to fair trade and the right to claim compensation,but the regulation of tied sales of bank loans under the existing laws of China However,China’s current laws on the regulation of tying of bank loans mainly punish banking institutions through the Banking Supervision and Administration Law,the Commercial Bank Law and the circulars of the Banking and Insurance Regulatory Commission,and there is no relevant protection and relief for consumers,and there is a problem of insufficient protection of consumers’ rights and interests in the regulation of tying of bank personal loans.Because of the disadvantaged position of consumers in bank personal loans due to factors such as information asymmetry,supply and demand,and financial resources,as well as the need to promote the sustainable development of the banking industry and improve social integrity,tilted protection should be provided to consumers who are tied in bank personal loans.To protect consumers of personal loans,it is necessary to define the scope of consumers of loans.In addition to the definition of the consumer in bank loans,the definition of the consumer in bank loans should be limited to the borrower and the definition of the concept of "financial consumer" and "bank consumer".The above concepts should be unified in one broad scope.However,the current legislation in China does not define the scope of financial consumers,which makes the concept of bank consumers unclear and makes it difficult to protect them in practice.At the same time,in order to adjust the weak position of consumers in relation to banking institutions,a tilted protection mechanism should be implemented and banking institutions should be required to fulfill the obligation of appropriateness.There are many problems with the fulfillment of commercial banks’ appropriateness obligations in China’s bank personal loans,mainly focusing on the fulfillment of the obligation to match products with customers and the obligation to inform and explain.China’s current regulation model for personal loans is based on "Civil Code" + "Consumer Protection Law" + "Banking Law",supplemented by departmental regulations and other legal norms.The civil law regulates the relationship between equal subjects,and bank consumers are in a vulnerable position when dealing with banking institutions,so the civil law cannot take into account the special characteristics of consumers and protect them in a favorable way;the problem of defining financial consumers also limits the role of consumer protection law;the banking law regulates the establishment and operation of banking institutions,but does not provide for the protection of bank consumers.The above-mentioned problems are the main reasons for the inadequate protection of consumers’ rights and interests in the tied sale of personal loans by banks.Financial consumers can be clearly defined as natural persons and ordinary investors,excluding professional investors,who purchase or use financial products or services.At the same time,banking institutions should be required to cover the entire process of lending,to take the initiative to inform the general consumer of the content of the form contract in a comprehensive and accurate manner in easy-to-understand language,to ensure that the general consumer can understand its meaning,and to "double-record" the information disclosure process to prevent banks from taking advantage of information to force customers to sign contracts that include tying.In terms of legal regulation,a chapter on bank consumers was added to the Commercial Bank Law,and the bank suitability obligation was elevated from a financial regulatory norm to a legal rule to make the suitability obligation statutory in the commercial bank sector.