1. If there is no interest agreement in the loan contract or IOU, it can often be presumed that the borrower does not have to pay interest to the lender. In other words, legally speaking, the borrower gets an interest-free loan.
2. Although it may cause some damage to the interests of the lender, it is also the embodiment of the principle of honesty and trustworthiness. We usually call it the interest-free hypothesis.
Loan related laws and regulations:
1. The Notice of the People's Bank of China on Banning Underground Banks and Combating usury stipulates that the interest rate of private personal loans shall be determined by both borrowers and borrowers through consultation, but the interest rate determined through consultation by both parties shall not exceed 4 times the interest rate of financial institutions in the same period and at the same level announced by the People's Bank of China (excluding floating). Those who exceed the above standards should be defined as high-interest loans.
The Supreme People's Court's "Provisions on Several Issues Concerning the Application of Law in the Trial of Private Lending Cases" stipulates in Article 26:
If the interest rate agreed between the borrower and the borrower does not exceed the annual interest rate of 24%, and the lender requests the borrower to pay interest at the agreed interest rate, the people's court shall support it.
2. The interest rate agreed by both parties exceeds the annual interest rate of 36%, and the interest agreement for the excess part is invalid. The people's court shall support the borrower's request to the lender to return the part of the interest paid that exceeds 36% per annum.
In the loan relationship between natural persons, there is no interest agreement between the borrower and the lender or the interest agreement is unclear. The lender claims to pay interest, but the court does not support it. Except for natural person loans, when the interest agreement between the borrower and the lender is unclear, the lender demands to pay interest, and the court will determine the interest from various angles such as market interest rate, trading environment and trading mode.
The loan interest shall not exceed the annual interest rate of 24%.
According to the Private Lending Law, the part whose interest rate exceeds 24% of the annual interest rate will not be supported, and the part exceeding 36% must be returned. If the part between 24% and 36% has been paid, there is no need to return it.
In other words, when choosing a loan, judging whether the loan products of small loan companies are compliant can be verified by the annual interest rate not exceeding 24%.
6 compound interest is not recognized in principle, but as long as the annual interest rate does not exceed 24%, it will conform to the regulations. According to the law of our country, the lender shall not include interest in the principal for compound interest. From this perspective, the law does not recognize compound interest, but it is not clearly stipulated in the contract law. According to the Private Lending Law, the annual interest rate shall not exceed 24%.