According to Article 4 of the Interim Regulations on the Administration of Banks in People's Republic of China (PRC), non-financial institutions are prohibited from engaging in financial business, and lending belongs to financial business, so enterprises of non-financial institutions are not allowed to lend to each other. Lending activities between enterprises can not only prosper China's market economy, but also disrupt the normal financial order, interfere with the implementation of national credit policies and plans, weaken the state's monitoring of investment scale, and cause chaos in the economic order.
Legal basis: Article 14 of the Provisions of the Supreme People's Court on Several Issues Concerning the Application of Laws in the Trial of Private Lending Cases shall be deemed invalid by the people's court in any of the following circumstances:
(a) to obtain credit funds from financial institutions and lend them to borrowers at high interest rates, and the borrowers knew or should have known in advance;
(2) The borrower knows or should know in advance that the funds obtained by borrowing from other enterprises or raising funds from employees of the unit are lent to the borrower for profit;
(3) The lender knows in advance or should know that the borrower is still providing loans for illegal and criminal activities;
(4) Violating public order and good customs;
(five) other violations of the mandatory provisions of laws and administrative regulations.