On the official website of the People's Bank of China, there are "general principles of loans" in the published departmental regulations, which shows that they are effective regulations. Published earlier, some clauses may not be in line with the current actual situation. For example, Article 6 The People's Bank of China and its branches are the supervisory institutions for implementing the general principles of loans. After the establishment of the China Banking Regulatory Commission, the supervision institution of loans is the banking supervision department. However, the whole Ordinance has not been declared invalid, and it is still valid. Bank loan interest rate refers to the ratio of interest amount to principal amount during the loan period. When a bank or other financial institution determines the interest rate of a loan contract as a lender, both parties can only negotiate and determine it within the upper and lower limits of the interest rate stipulated by the People's Bank of China. If the loan interest rate is high, the repayment amount of the borrower will increase after the loan term, otherwise it will decrease. There are three factors that determine the loan interest rate: loan amount, loan term and loan interest rate.
legal ground
General Rules for Loans of China People's Bank
Article 3 The issuance and use of loans shall comply with national laws, administrative regulations and management regulations issued by the People's Bank of China, and follow the principles of efficiency, safety and liquidity. Article 4 Lending activities of borrowers and lenders shall follow the principles of equality, voluntariness, fairness, honesty and credibility. Article 6 The People's Bank of China and its branches are the supervisory institutions for implementing the general principles of loans. Article 12 If the loan cannot be repaid on schedule, the borrower shall apply to the lender for extension before the loan expires. Whether the extension is decided by the lender. When applying for extension of secured loan, mortgage loan or pledged loan, the guarantor, mortgagor and pledgor shall also issue a written consent certificate. If there is an agreement, it shall be implemented in accordance with the agreement. _
The cumulative extension period of short-term loans shall not exceed the original loan period, the cumulative extension period of medium-term loans shall not exceed half of the original loan period, and the cumulative extension period of long-term loans shall not exceed 3 years. Unless otherwise stipulated by the state. If the borrower fails to apply for extension or the application for extension is not approved, the loan will be transferred to the overdue loan account from the day after the maturity date. _