Study On The Legal Regulation Of Private Lending Rate

On the legal regulation of private lending interest rate in China,in 20015, the supreme court issued the judicial interpretation-Several provisions of the Supreme People's Court on the application of the law in the trial of private lending cases. There are some novelties in the judicial interpretation issued in 2015. Such as, the 2015 judicial interpretation expanded the main body of the private lending, which was not mentioned in the judicial interpretation issued in 1991. About the ceiling of the private lending interest rates, it changed the “4 times interest rates” into “2 lines and 3 areas”. It clarified the legal consequences on the lending interest rate that was exceeded the upper limit. It abolished the rule that the ceiling of the private lending interest rate was connected with the bank rate. It stipulated that the private lending interest rates should be connected with the capital. However, the 2015 judicial interpretation stipulated the upper limit at the level of annual interest of 24%, which was not different from the “4 times interest rates” of the 1991 judicial interpretation indeed. In another words, “annual interest of 24%” was another form of the “4 times interest rates”. There were some unreasonable regulations in the two judicial interpretations both. Such as, the way to restrict the upper limit was unreasonable. Ignoring the differences between the productive lending and the consumer lending at the course of the upper limit was restricted, etc. All of the problems should be given the most urgent attention, right now.The article divides into four parts altogether. In the first part, the private lending interest rate was explained synoptically, including the meaning and the function of the private lending interest rate, the influencing factors of the level of the private lending interest rate. And the necessity to regulate the private lending interest rate was expounded. In the second part, the strict regulation of the private lending interest rate was expounded, and the 3 main problems on the regulation of the private lending interest rate were pointed out. In the third part, on the regulations of the private lending interest rate that some countries and regions adopted were expounded. The aforementioned countries and regions included Germany, USA, Japan and Hong Kong. Then, the legal regulation of private lending interest rate in China was compared with the aforementioned countries and regions, and what can we draw on the experience of other countries and regions were considered. In the fourth part, the suggestions on the legal regulations of private lending interest rate in China were proposed.