A number of small and medium-sized banks in China issued announcements in May, stating that they are implementing policies requiring the disclosure of the comprehensive financing costs of corporate loans. Analysts said this is not merely an information disclosure requirement, but also an institutional tool aimed at lowering financing costs for the real economy, strengthening financial consumer protection and regulating order in the credit market.
Earlier this month, Sichuan Longchang Rural Commercial Bank announced that starting from May 20, customers applying offline for newly contracted loans would be required, before loan disbursement, to sign a comprehensive financing cost disclosure form for corporate loans or personal loans. The form details loan interest rates and all non-interest expenses, helping customers fully understand the total cost of obtaining a loan.
A sample form released by Tianjin Rural Commercial Bank on May 15 showed that the cost list includes bank interest rates, details of other financing costs and the enterprise's total financing cost. The details of other financing costs include guarantee fees, appraisal fees, collateral or mortgage registration fees, collateral monitoring fees, trade financing service charges and intermediary service fees.
