First, usury.
The Notice of the People's Bank of China on Banning and Combating usury stipulates that the interest rate of private individuals shall be determined by both borrowers and lenders through consultation, but the interest rate determined through consultation between the two parties shall not exceed four times the interest rate of financial institutions at the same period and at the same level announced by the People's Bank of China, excluding fluctuations. Those who exceed the above standards should be defined as high-interest loans. In other words, the interest rate of usury depends on personal transactions, but it is four times higher than the national legal loan interest rate, otherwise it does not constitute usury. Whether usury is illegal or not is a form of private lending. The Notice of the People's Bank of China on Banning and Combating usury stipulates: "The interest rate of private individual lending shall be determined by both borrowers and borrowers through consultation, but the interest rate determined through consultation between the two parties shall not exceed four times the interest rate of financial institutions in the same period and at the same level announced by the People's Bank of China. Those that exceed the above standards should be defined as high-interest lending. "
In other words, folk usury occurs between natural persons and between natural persons and units, and the loan interest rate is four times higher than the bank loan interest rate in the same period. Usury itself is a voluntary behavior of both borrowers and borrowers, which is conducive to the use of funds and economic development. Although at the national level, due to the need of interest control, there is no floating protection for the part that exceeds the loan interest rate of financial institutions at the same time and at the same level, but usury is not included in the crime, so it has not affected the long-term existence of usury. There is no charge of usury in the criminal law, only the crime of illegally absorbing public deposits. However, those who violate the criminal law in the process of usury should be investigated for criminal responsibility according to law.
Second, the usury interest exceeds the principal.
Private lending is a civil act, which is bound and protected by civil law and contract law.
However, according to Article 211 of the Contract Law: "If the loan contract between natural persons stipulates to pay interest, the loan interest rate shall not violate the relevant provisions of the state on limiting the loan interest rate". According to the Provisions of the Supreme People's Court on Several Issues Concerning the Application of Laws in the Trial of Private Lending Cases, if the annual interest rate agreed by both parties does not exceed 24%, the lender has the right to require the borrower to pay interest at the agreed interest rate. However, if the interest rate agreed between the borrower and the borrower exceeds the annual interest rate of 36%, the interest exceeding the annual interest rate of 36% shall be deemed invalid. "Provisions of the Supreme People's Court on Several Issues Concerning the Application of Laws in the Trial of Private Lending Cases" Article 26 If the interest rate agreed by both borrowers and lenders does not exceed 24% per annum, and the lender requests the borrower to pay interest at the agreed interest rate, the people's court shall support it. The interest rate agreed between the borrower and the borrower exceeds the annual interest rate of 36%, and the interest agreement in excess 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.