Private Lending Risk Prevention Research

At present,with the rapid economic and technological development,the market economy is becoming increasingly perfect,which provides opportunities and a platform for private loans.However,problems have emerged one after another alongside the development of private loans.This thesis is composed of four chapters.The first chapter is about the major theories on private loans.The first section mainly introduces the definition of private loans—it is loans between citizens or between citizen and legal person,or loans between organizations.The loan relationship is valid as long as both parties provide true opinions.Private loans,especially loans between individuals,should strictly adhere to laws,regulations,and basic principles such as voluntary mutual assistance and integrity.The second section introduces the forms of private loans.This thesis takes “underground bank” and “P2P” as examples,analyzes the diversity of private loans,and points out that private loans can be risky,so as to pave the way for the next chapter.The second chapter focuses on the current situation of the legislation and practice of domestic private loans,and then analyzes the existent risks and problems.This chapter is composed of two sections.The first section introduces the domestic legislation and other limits on private loans;the second one discusses the diversity of private loans from perspectives of the expansion of market as well as the increase of loan interests.The third chapter analyzes the legal risks and causes of private loans in two sections.The first section,starting from the legal risks of domestic private loans,mainly discusses the causes of risks during the loans.This thesis,from the perspective of law,researched the risks of private loans,which include problems of usury and guarantee.Then this section sums up the risks existing currently in domestic private loans.The second section points out that the causes of risks in private loans can be complicated.This section will mainly analyze from perspectives such as the huge operating pressure of enterprises due to the tightening of banks' financial policies,the weak financial supervision and so on.The fourth chapter,composed of two sections,mainly explores how to effectively improve the current system of risk control in domestic private loans.This thesis,based on the current problems and the causes,suggests that the legal system of private loans should be established and improved.On the one hand,we should consistently improve the related legislation in accordance with the current situation,and give full play to the existent laws,and revise the laws and regulations to ensure their efficiency.Meanwhile,supporting regulations should be improved.On the other hand,governmental supervision on private loans should be enhanced,and domestic private loans should be strictly regulated,so as to maintain the order of private loans.The second section,on the basis of current situation,suggests the establishment of registration and mortgage system of private loans,so as to improve the effectiveness of private loans through the aforementioned systems.In short,this thesis,from the perspective of the legal professionals,makes in-depth analysis and exploring of the private loans risks controlling.In particular,this thesis analyzes the most popular forms of private loans – “P2P” online lending platform and “underground banks”,and then explores the main causes of the problems.In the end,this thesis puts forward some practical preventive measures,in order to make a due contribution to domestic prevention of risks in private loans.