According to the relevant provisions of the supreme law of August 2015, if the interest rate agreed by both parties of private lending does not exceed 24% of the annual interest rate, the peoples court shall support it if the lender requests the borrower to pay interest according to the agreed interest rate; if the interest rate agreed by both parties exceeds 36% of the annual interest rate, the interest agreement on the excess part is invalid.
Private lending has become an objective reality and plays an indispensable complementary role. Zheng Xuelin, President of the first peoples Court of the Supreme Court, said a few days ago that in recent years, some market entities, deputies to the National Peoples Congress and members of the Chinese peoples Political Consultative Conference have reflected that the interest rate of private loans protected by the peoples court is too high, which has aroused the high attention of the Supreme Court. We are paying close attention to the problem that the interest rate of private lending under judicial protection is too high reflected in the society.
In response to the reduction of the upper limit of private lending interest rate protection, Zheng Xuelin said that it is of positive significance and the most effective solution to ease the financing difficulties and high financing costs of enterprises and prevent routine loans and false loans from the source.
If we really lower the upper limit of private lending interest rate protection as stated in the supreme law, it will undoubtedly be a drastic blow to the private lending industry.
Prudent interest rate control
On this point, many experts expressed their views. To sum up, it is impossible to solve the problem only by suppressing and encircling private finance, which requires conscious guidance and guidance.
Private lending has developed for many years in China, and its background is to better implement the inclusive financial policy to meet the financing needs of those relatively vulnerable groups and high-risk customers. Once the loan interest rate is intervened, the small and micro enterprises and individuals mainly relying on private lending may have more difficulties in obtaining funds, and the problems of difficult and expensive financing have not been solved.
Dong ximiao, chief researcher of Zhongguancun Internet Finance Research Institute, told our reporter, we can appropriately restrict the interest rate of private lending, but if we use planning means and legal means to interfere with the financial operation law, and forcibly break the principles of risk pricing and income and risk matching , the effect may be counterproductive.
Restricting the interest rate of private lending will destroy the sunshine work of private lending promoted by many academic circles in the industry, and gradually transfer the originally sunny private lending to the ground, which will lead to more serious consequences.
In his opinion, we often emphasize the marketization of interest rates in the financial market, which is essentially the price of funds and should be determined by the market rather than strictly controlled. This is not in line with economic laws.
Compared with the regulation of interest rate, it should be guided consciously. Dong ximiao said that instead of strictly managing private lending rates, it is better to guide private capital and promote private capital to better serve the real economy.
Ji Shaofeng, a well-known commentator on Internet Finance and a financial columnist, believes that if the interest rate level is excessively restricted, it is easy to make the social vulnerable groups and high-risk customers unable to obtain loans. Using annualized interest rates across the board will easily make vulnerable groups victims of Inclusive Finance.
In this way, it runs counter to the original idea of regulation.
He suggested that when the supply of credit organizations in Chinas banking industry lags behind the financing demand of small and medium-sized enterprises, it is more significant to moderately liberalize interest rate control and guide small and micro financial organizations to meet the financing needs of private economy and vulnerable groups. It can partially achieve the goal of rectifying Chinas unbalanced dual financial system.
Ji Shaofeng said that there is no standard for high interest rates, but as long as the two sides agree in a completely fair and just environment and get payment back through legal channels after loan, this behavior fully conforms to the law of interest rate marketization.
Zhang Huaqiao, chairman of slow bull capital, almost expressed the same view. He believes that the lower the interest rate ceiling, the better. Now 24% and 36% are appropriate. A reduction of 2-3 percentage points is also acceptable.
It is necessary to exist
At present, Chinas financial system is not perfect, commercial banks and other financial institutions can not fully undertake this business. Although rural banks, private banks and other small and medium-sized banks are gradually established, their service capacity is limited and they can not meet the financing needs of small and medium-sized enterprises and individuals. Therefore, private lending will not disappear for a while.
If the upper limit of interest rate protection for private lending is lowered, some companies without or without complete licenses will be kicked out. Many Internet lending platforms are lending through small loan companies or network small loan companies, which will have an impact on their stock and incremental business.
Dong ximiao bluntly said that if the private lending interest rate is reduced, some borrowers will think that the interest rate of the borrowed platform is too high, and the higher part may not be willing to repay, which is not conducive to protecting the legitimate rights and interests of the lending platform. The high capital cost and high customer acquisition cost will also affect the new business of the lending platform. This is too idealistic, out of touch with reality.
Financial technology companies have also played an important role in the financing of small and medium-sized enterprises and individuals. The use of new technologies such as big data and artificial intelligence has made the user groups of financial technology companies sink further, touching users that cannot be covered by financial institutions. New models such as loan assistance, joint loan and Internet loan have also begun to appear.
In particular, the head of the financial technology giants are doing loan assistance business, the business itself does not lend. However, due to the stigmatization of Internet Finance in recent years, many users regard some mutual fund platforms as private loans. The reduction of the upper limit of interest rate protection for private lending is bound to have a certain impact on it. As for whether the maximum interest rate in the loan law is applicable.
There should be a line between what the government does and what it doesnt do, an industry official told our reporter. The multi-level financial demand has always existed. Suppressing the demand can only lead to social injustice, and people can not enjoy financial services equally, thus more underground transactions will appear. What the government should do is to create a clear and orderly market environment, vigorously build a credit reporting system and a simple judicial procedure for microfinance, crack down on dishonest and malicious debt evaders, increase the bad debt cost of Laolai, and change the cost logic of good people subsidizing bad guys. A devil is a foot tall. As for the phenomenon of routine loans and false loans in the industry, they dont care about the so-called red line. The people who exploit the loopholes are always there. In the financial lending industry, Lao Lai is in vogue. Especially during the epidemic period, a large number of debt evasion and cancellation broke out, and some people indicated that they would not pay their debts. Therefore, it is necessary to educate borrowers and accelerate the implementation of personal bankruptcy system to raise the cost of bad debts. Source: China Times editor in charge: Li Zhaoyuan_ B7890
A devil is a foot tall. As for the phenomenon of routine loans and false loans in the industry, they dont care about the so-called red line. The people who exploit the loopholes are always there. In the financial lending industry, Lao Lai is in vogue. Especially during the epidemic period, a large number of debt evasion and cancellation broke out, and some people indicated that they would not pay their debts. Therefore, it is necessary to educate borrowers and accelerate the implementation of personal bankruptcy system to raise the cost of bad debts.