Private lending is a kind of private financial activity with a long history and widespread worldwide, which mainly refers to the financing behavior between natural persons, between natural persons and legal persons or other organizations, and between legal persons or other organizations with money or other securities as the target. Financial institutions engaged in loan business and their branches established with the approval of financial supervision departments, and related financial businesses such as issuing loans do not belong to the category of private lending.
Most loan contracts are important contracts. Unless otherwise agreed between natural persons, a loan contract shall be in written form. The loan contract shall include the loan type, currency, purpose, amount, interest rate, term and repayment method. In addition, the loan application, loan voucher, agreement and relevant written materials for modifying the loan contract are all components of the loan contract.
Legal basis: Article 680 of the Civil Code of People's Republic of China (PRC).
It is forbidden to lend at high interest rate, and the lending rate shall not violate the relevant provisions of the state.
If there is no agreement on the payment of interest in the loan contract, it shall be deemed that there is no interest.
If the loan contract does not specify the payment method of interest, and the parties cannot reach a supplementary agreement, the interest shall be determined according to the local or the parties' trading methods, trading habits, market interest rates and other factors; Loans between natural persons are regarded as interest-free.