Interest rate marketization: how much impact on the people

In recent years, the people often complain that "money in the bank is not cost-effective", a direct cause of low interest rates on deposits. Deposit interest rate is high or low, determines the cost of the bank to use the funds. If the deposit rate is low, the bank's cost of funds, expanding the bank's profit zone. Measurements show that the net interest margin of domestic banks is generally between 2.5% and 3%.

The recent executive meeting of the State Council, which studied and deployed the key work of deepening the reform of the economic system in 2013, explicitly mentioned that: interest rates and exchange rates will be steadily launched market-oriented reform measures. According to the National Development and Reform Commission "on the deepening of economic system reform in 2013 the key work of the opinion", steadily promote the interest rate and exchange rate market-oriented reforms, and gradually expand the range of deposit and loan interest rates floating, and the establishment of a sound market benchmark interest rate system has been put on the agenda of this year's financial reforms, meaning that the interest rate reform and a step forward.

Interest rate market-oriented reform is a fundamental reform, the goal is to play a good market allocation of resources of the fundamental role; and now, the financial market to implement a two-track system, which is fundamentally not conducive to the optimal allocation of funds in the market, and therefore the need to accelerate the process of interest rate market-oriented reform. For the time being, the interest rate marketization reform can work in these directions: cancel the lower limit of RMB lending rate in due course, and raise the upper limit of floating deposit interest rate to 20% or above; simplify the term structure of deposit and loan interest rate, and cancel the benchmark interest rate of deposit and loan of more than one year's term; improve the transmission mechanism of the monetary policy, and give full play to the role of the price-type tools.

Traditionally, the reserve requirement ratio and open market manipulation play a very indirect role. And interest rate adjustments are actually changes in the price of financing in the real sector of the economy, each financial consumer as well as depositors through the changes in their deposits and interest, can be felt directly. It can be said that the marketization of interest rates will have an impact on all aspects of people's lives. And, generally speaking, the marketization of interest rates will bring benefits to the people regardless of whether interest rates rise or fall.

Today, no matter which bank you go to deposit money, the interest rate is the same. After the marketization of interest rates, banks will be differentiated, different banks with the same currency and period will implement different interest rates, the same bank with the same currency, the same period can be due to the size of the deposit amount there are several deposit interest rate brackets. In this case, the deposit interest rate of strong, creditworthy banks with excellent service and high degree of electronic technology may be slightly lower, because most of these banks have rigorous and scientific management, low risk, and a high safety factor for deposits. Weaker commercial banks, on the other hand, may use high interest rates to attract depositors so that they can absorb the deposits. The general public can either choose a high-interest bank with a view to getting a high interest rate or, for insurance purposes, choose a bank that does not offer high interest rates but is strong and low-risk.

After the marketization of interest rates, the interest rates on consumer loans from banks to individuals will also be marketized. Different people will get loans from banks at different interest rates, and personal creditworthiness records will play an increasing role in consumer credit. Banks will decide the loan interest rate for each individual in full accordance with the credit status of the borrower and the comprehensive situation of occupation and education. Consumers who have no bad credit record, and have higher education and regular occupation can not only easily get a loan from the bank but also the interest rate may be very low, and those who have good credit will be more favored by the market. From the experience of foreign interest rate marketization, after the marketization of interest rates, bank deposit interest rates will generally increase, loan interest rates will fall, the people will get more benefits.

In addition, the marketization of interest rates will have an important impact on personal consumption. The pursuit of profit maximization is the essence of the characteristics of capital, when the market interest rates in the low run, people tend to increase the immediate consumption of the strength, which strongly activate the consumer market. While the market interest rate in the high run, generally will reduce material consumption and increase investment, personal funds flow to the industrial market to increase the possibility of the pursuit of higher interest income and return on capital. Through the marketization of interest rates, can give full play to the role of interest rates in the rational allocation of funds, business and personal behavior will be more closely linked to the rise and fall of interest rates.

With the steady progress of interest rate marketization, the interest rate reform will intensify the competition in the banking industry, and banks have to cope with it through the improvement of bargaining power and liability management ability, and the use of non-price competition means, so as to enhance the profitability of the banking industry:

Commercial banks have to continuously improve their asset-liability management ability in the process of interest rate marketization, as well as to improve the quality of their services, and to improve the quality of their services through the increase in the number of non-price competition to cope with the pressure of narrowing spreads; increase financial innovation, accelerate the pace of business innovation, expand the business operating space, customer market areas, and constantly explore new points of growth in efficiency, and realize the diversification of the operating structure, customer structure and revenue structure; strengthen marketing innovation, product innovation, service innovation, innovation in financial instruments, etc., and change the traditional financial marketing concepts, and strive to win the market and profitability of the banking industry with the unique features and advantages of the business. We will strengthen marketing innovation, product innovation, service innovation and financial instrument innovation, and change the traditional financial marketing concepts, and strive to win the market and customers with our unique features and advantageous business.

Interest rate marketization will inevitably increase the interest rate risk, liquidity risk and credit risk faced by commercial banks, but at the same time, it also brings good development opportunities for commercial banks. An important impact of interest rate marketization on commercial banks is that it enables them to gain pricing power over deposits and loans. However, after years of interest rate control, China's commercial banks have become accustomed to the pricing mechanism of interest rates under the interest rate control system, which puts higher demands on the risk management ability of commercial banks. China's commercial banks must actively carry out the construction of financial product pricing mechanism, accelerate the improvement of deposit pricing mechanism, loan pricing mechanism, service pricing mechanism and authorization pricing mechanism.

And the people are most concerned about, or whether the money bag will be "safe" to drum up. Industry insiders pointed out that, as financial consumers, ordinary residents, asset value-added first to run through the price increases, followed by access to the interest rate level appropriate to the market position. The advancement of interest rate marketization, will force the bank's deposits, wealth management products have more differentiation, the people's financial management will also appear more choices.