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Interpretation of cash loan interest rate: annual interest rate of 36% and "two lines and three districts"

Time: 2018-08-24         Source: Rong 360 original         Author: light

The relevant departments will rectify the cash loan as scheduled, and many non-compliant platforms have begun to rectify the downline. An important reason for non-compliance is that the actual interest rate of the product is too high, and how high the interest rate is legal and compliant. What?

As early as the financial market reform in November 2013, the Supreme People's Court demarcated the two red lines of 24% and 36%. The two red lines divided the interest rate into three “regions”:

Judicial protected area

If the interest rate agreed by the borrower and the lender does not exceed 24% per annum, and the lender requests the borrower to pay interest at the agreed interest rate, the people's court will support it;

Invalid area

The interest rate agreed by both the borrower and the lender exceeds the annual interest rate by 36%, and the excess interest agreement is invalid. If the borrower requests the lender to return the interest paid more than 36% of the annual interest rate, the people's court shall provide support;

Natural debt zone

The part between 24% and 36%, if the lender is suing the people's court for the protection of interest in this section according to the contract, the people's court will not protect the law; if the borrower repays this part of the interest and then repents, it goes to the court. The lawsuit is recovered and the court will reject such a claim;

Summary of the vernacular

Interests within 24% are protected by law and must be returned; more than 36% of interest can be repaid, and can also be recovered through legal channels; interest between 24% and 36%, if not returned, The court will not accept the lender’s request for recovery, and if it has already been returned, the court will not accept the borrower’s request for recovery;

The origin of the 24% standard

For private lending, the government's regulation is long-term. After the founding of the People's Republic of China, the earliest reply to the private lending by the Supreme Law was in Liaoning in the early 1950s, which determined the practice of quadruple interest rates. Since then, the quadruple interest rate has been used in trial practice. In 1991, judicial interpretation was formulated. I continued to use this practice.

In the past 20 years, the benchmark interest rate of loans issued by the central bank has changed greatly. The lowest is 2%, the highest is 12%, and the middle is 5%-8%. So I chose the middle. 6%, and referring to the traditional four times the meaning, get 24% of such a number.

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