Legal analysis: Interest can be agreed upon in the contract, but the court will not support it if the interest rate agreed upon by both parties exceeds four times the one-year loan market quote rate at the time the contract is established. "One-year loan market quoted interest rate" refers to the one-year loan market quoted interest rate published monthly by the National Interbank Funding Center authorized by the People's Bank of China since August 20, 2019.

Legal basis: "Regulations of the Supreme People's Court on Several Issues Concerning the Application of Law in the Trial of Private Lending Cases" Article 25 If the lender requests the borrower to pay interest according to the interest rate agreed in the contract, the People's Court shall support it. However, this is excepted if the interest rate agreed upon by both parties exceeds four times the one-year loan market quote rate at the time the contract is established.

The "one-year loan market quoted interest rate" referred to in the preceding paragraph refers to the one-year loan market rate published monthly by the National Interbank Funding Center authorized by the People's Bank of China since August 20, 2019. Quoted interest rate.

Article 26 The loan amount stated in IOUs, receipts, IOUs and other debt certificates is generally recognized as the principal. If interest is deducted from the principal in advance, the people's court shall determine the actual loan amount as the principal.

Article 27 After the borrower and the lender have settled the principal and interest of the earlier loan, the interest will be included in the principal of the later loan and a new credit certificate will be issued. If the early interest rate does not exceed the one-year loan market quoted interest rate of 4 times, the amount stated in the reissued credit certificate can be recognized as the later loan principal. The excess interest shall not be regarded as the later loan principal.

Based on the calculation of the preceding paragraph, the sum of principal and interest payable by the borrower after the expiration of the loan period exceeds the initial loan principal and the initial loan principal as the basis, based on the one-year loan market at the time the contract is established. If the sum of the interest for the entire loan period is calculated as four times the quoted interest rate, the People's Court will not support it.

Article 28 If the borrower and the lender have an agreement on the overdue interest rate, the agreement shall prevail, but it shall not exceed four times the market quoted interest rate for one-year loans at the time the contract is established.

If the overdue interest rate is not agreed upon or the agreement is unclear, the people's court may distinguish between different situations: (1) Neither the interest rate during the loan period nor the overdue interest rate is agreed upon, the lender shall If the borrower is held to be liable for overdue repayment and breach of contract based on the interest calculated from the date of overdue repayment with reference to the prevailing one-year loan market quotation rate standards, the People's Court shall support this;

(2) The loan agreement has been stipulated The interest rate during the period but the overdue interest rate has not been agreed upon. If the lender claims that the borrower should pay interest during the period of capital occupation based on the interest rate during the loan period from the date of overdue repayment, the People's Court shall support it.