Abstract
This chapter reviews the third-party payment and consumer finance industry in China, Japan, and South Korea. Focusing on credit card overdrafts, loan quality, key consumption sectors, credit card regulatory policy, and other credit business, this chapter draws attention to the current credit card systems in China, Japan, and South Korea. Case studies of Credit Saison Co. Ltd. and Lotte Credit Card are presented which include the development, transformation, and experiences of the two companies
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Notes
- 1.
In addition, relevant laws include the Act on Specified Commercial Transactions (formerly Door to Door Sales Act), the Consumer Contract Act, and related e-commerce laws.
- 2.
Initially, the law concerning the Cooling-off Period System was only applicable to specific merchandise transactions. After the 1999 amendments, the specified rights and specified services also became the legal objects of the Cooling-off Period System.
- 3.
In the 1960s and 1970s, various countries strengthened their protection of consumers’ legitimate rights and interests in their economic legislations. However, since the 1980s and 1990s, European countries and the USA have changed their ways of consumer protection, gradually shifting from the government-oriented passive protection to the consumer-led proactive maintenance. The formulation and adjustment of relevant laws and regulations also further reflect the legal fairness and impartiality to market players. For example, the management of the consumer financial market has shifted its focus from investigating and affixing the operator’s accountability to emphasizing consumers’ “own responsibilities”. This has basically established the equal status of the operator and the consumers.
- 4.
After 2004, the use of credit cards went wrong, so credit cards were no longer used. In order to consolidate cash receipts, the financial resources were used for a cash receipt lottery.
- 5.
If credit cards are stolen or lost, appointed stores falsely claim cardholders’ account funds through forged or falsified voucher, which causes the cardholders to take a risk for reporting the loss and the guarantors to take the responsibility, and so on. During this period, “Cardholder Application Agreement” and “merchants contract” are mainly used to regulate the rights and obligations of issuers, cardholders, and merchants, but these contracts and some original law cannot solve some legal problems caused by credit card use.
- 6.
The Specialized Credit Financial Business Act credit card industry refers to settlement loan, issuing and management of credit card, recruitment and management for credit card merchants.
- 7.
The minimum requirement for capital: 20 billion yuan to run no more than two credit financial industries; 40 billion yuan to run more than three credit financial industries. The requirement for major shareholder: to have the economic ability, financial stability, and no violation of relevant laws for illegal financial facts.
- 8.
According to the measures, if someone is over 20 years old, his income is more than the debt principal and interest, and his credit rating is six or more, he can apply for a credit card. In terms of age, anyone who is at least 18 years old and obtains the consent of his or her legal representative can apply for a credit card. According to the above measures, only those who are at least 20 years old can apply for credit cards. In principle, anyone with a disposable income can apply for a credit card. In other words, his income must be more than the debt principal and interest. As for the credit rating, the applicant must get scores between 1 and 6 from more than one credit rating company. Credit card limit will be decided by payment capability, credit rating grade, and swiping card expenditure. The Finance Committee will revise the related laws, orders, and regulations.
- 9.
A service that offers a given discount when customers buy a high-price commodity, and the discounted amount can be paid in the bonus points accumulated when they utilize the credit card in the future.
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Gang, Z., Yiguo, X. (2017). Credit Card Business and Consumer Finance of China, Japan, and South Korea. In: Wang, G., Zeng, G., Xiaoying, X. (eds) Development of Consumer Finance in East Asia. Palgrave Macmillan, New York. https://doi.org/10.1057/978-1-137-52418-8_3
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DOI: https://doi.org/10.1057/978-1-137-52418-8_3
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