It is legal for companies to lend money to individuals according to law. A loan contract is a contract in which the borrower borrows money from the lender, repays the loan at maturity and pays interest. A legally established loan contract is protected by law, and the loan interest shall comply with the law. However, the company may not provide loans to directors, supervisors and senior managers directly or through subsidiaries. The effect of a company borrowing from an individual is legal in law. It belongs to private lending stipulated by law and can be used for financial lending between natural persons and organizations, so enterprises can borrow from individuals, but the law will limit usury.
Legal basis:
Company Law of the People's Republic of China
Article 148 Directors and senior managers shall not commit any of the following acts:
(1) Misappropriation of company funds;
(2) Opening an account for the company's funds in its own name or in the name of other individuals.
(3) Lending the company's funds to others or providing guarantee for others with the company's property without the consent of the shareholders' meeting, the shareholders' general meeting or the board of directors, in violation of the provisions of the company's articles of association;
(four) in violation of the articles of association of the company or without the consent of the shareholders' meeting or the shareholders' meeting, enter into a contract or conduct a transaction with the company;
(5) Without the consent of the shareholders' meeting or shareholders' meeting, taking advantage of his position to seek business opportunities belonging to the company for himself or others, and running the same business as the company he works for;
(six) accept the entrustment of others and regard the transaction with the company as your own;
(seven) unauthorized disclosure of company secrets;
(8) Other acts that violate the obligation of loyalty to the company.
The income of directors and senior managers who violate the provisions of the preceding paragraph shall be owned by the company.
People's Republic of China (PRC) Civil Code
Article 667 A loan contract is a contract in which the borrower borrows money from the lender, repays the loan at maturity and pays interest.
Article 668 A loan contract shall be in written form, unless otherwise agreed between natural persons.
The contents of a loan contract generally include terms such as loan type, currency, purpose, amount, interest rate, term and repayment method.