The China Banking Regulatory Commission has issued a circular which asks Chinese banks not to provide credit card services to students under 18 years old.

Furthermore, CBRC asks banks to obtain a written consent from parents of students who are over 18 years old stating that the parents pledge to pay off any debt incurred by their children.

In the past five years, commercial banks in China have been taking the issuance of credit cards as a main index of their performance. As a result, they have been busy issuing the cards without considering the quality of the cardholders. To call an end to this problem, CBRC has asked banks not to use the issuance of card as the only way to judge the performance of its marketing staff.

A representative from a Chinese bank has also disclosed to local media that the abuse of credit granting has become a major problem in the Chinese banking industry. Data released by China's central bank showed that the credit card bad account rate had been on the increase and by the end of the first quarter of this year, the total debt whose payment had been delayed for over six months reached CNY4.97 billion, which was an increase of 133.1% over the same period of last year.

As a way to address the bad debt problem, CBRC asks each of the banks to conduct a due diligence review on the credit level and payment ability of credit card applicants by requiring them to have a fixed job, or stable income or a reliable insurance for paying back any debt.