Study On Legal Problems About Regulation Of Private Lending Rate In China

Centering on the article 6 in Some Opinions of the Supreme People’s Court on Trial of Cases Involving Debt and Credit by the People’s Court, the interest rate regulation measure highlights the keynote of our country’s strong control towards interest rate of private lending. Up to this day, it has run for more than 20 years. In the context that there is continuous development of market economy and marketization of interest rate, interest rate regulation mode and determination of interest rate cap at present in our country can no longer meet the real requirements of economic development, they even bring more negative effects, and it’s difficult to achieve the desired results by continuing to use them.Interest rate is the starting point of regulation for private lending and also the key factor to inspect whether the private lending is legal or not. Degree of protection and development direction of private lending is determined by the degree of its interest rate regulation. However, private lending doesn’t just relate to problems regarding distribution of property and autonomy of will among parties involved, but more relates to public problems of national economic development and safety as well as social stability. Therefore, it is of great significance to study how to regulate private lending interest rate.There are four parts in this paper. The first part is the introduction for regulation of private lending interest rate. Firstly, the concept of private lending is defined in this part; secondly, connotation of regulation of private lending interest rate is stated; finally, basic procedures of regulation of private lending interest rate in our country is introduced, including summary of features regarding current lending rate in our country and analysis on basic paths by which regulation of private lending interest rate is performed.In the second part, dilemma regarding regulation of private lending interest rate in our country is discussed, including dilemmas in terms of legislation for and judicial application of private lending in our country. For dilemma in terms of legislation, it begins with the major dispute on private lending in current academic world, including deficiencies in current legislation for regulation of private lending, conflicts and contradictions between current laws, and rationality regarding regulation of lending interest rate cap. For dilemma in terms of judicial application, specific cases are taken as the entry point to explore some of the dilemmas regarding judicial application of private lending, including application of compound interest in juridical practice, the judicial criteria regarding violation of legal interest rate cap and presumption rules of interest rate under the situation that there is no agreement regarding overdue interest. Analysis and comparison are performed by the author to get his own thought.The third part is about the comparative observation on regulation of private lending interest rate overseas and the enlightenment. The USA, Germany and Hong Kong Region are selected for observation and analysis. Based on this, enlightenment from practices in these countries or region is summarized, including formulating exclusive legislation for regulation of private lending and setting reasonable interest rate cap that conforms to development of private lending in our country according to current situation.In the fourth part, based on investigations on current laws that regulate private lending interest rate in our country and by combining experience from relevant countries overseas, proposals for improving legal regulation of private lending interest rate are put forward, including improving legal norms of private lending, establishing sound supervision mechanism of private lending, strengthening the judicial regulation of private lending interest rate and establishing relevant supporting systems for regulation of private lending interest rate.