The benchmark loan interest rate (LPR) is the benchmark loan interest rate calculated and published by the National Interbank Funding Center authorized by the People's Bank of China. Representative quotation banks quote in the form of open market operating rate (mainly referring to medium-term lending convenience rate) according to the bank's loan interest rate to the best quality customers. All financial institutions should mainly refer to the loan pricing of LPR. At present, LPR includes one-year and five-year varieties.
LPR has a high degree of marketization, which can fully reflect the supply and demand of funds in the credit market. Using LPR for loan pricing can promote the marketization of loan interest rate and improve the transmission efficiency from market interest rate to credit interest rate.