Legal Analysis: On August 20, 2020, the Supreme People's Court issued the Provisions on Several Issues Concerning the Application of Laws in the Trial of Private Lending Cases, the core clause of which was to modify the original 24% legal protection clause, and to determine the upper limit of judicial protection of private lending interest rates by taking the LPR issued by CFETS authorized by the People's Bank of China as the standard. According to the latest LPR interest rate of 3.85%, the upper limit of judicial protection of private lending interest rate is only 15.4%.

Legal basis: 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, 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.