1. Is the private lending company legal?
Establish the Law on New Compliance Private Lending Institutions, allowing private capital to create new compliance private lending institutions, and make it clear that new compliance private lending institutions should be legal financial institutions with the same qualifications as existing formal financial institutions; It is clear that its function is to specialize in legal private lending and serve private economic units. In this way, the law clearly defines the positioning of private lending, indicating that private lending activities and formal lending complement and promote each other, thus realizing the benign existence of private lending and formal lending.
Second, what are the conditions for legal private lending?
1. Legal private lending must be voluntary lending by both parties.
The loan relationship formed by one party through fraud, coercion or taking advantage of the danger of others is a revocable contract, which should be deemed invalid after exercising the right of revocation. The reason why the loan-loan relationship is invalid is caused by the creditor's behavior, and only the principal is returned; The reason why the loan relationship is invalid is caused by the debtor's behavior. In addition to returning the principal, interest should also be paid with reference to the bank's similar loan interest rate.
2. Legal private lending funds must belong to the lender or have the right to control their own funds. The loan relationship formed by the property that is not owned by the lender or that the lender has no control right is invalid and not protected by law.
3. Legal private lending is forbidden to absorb other people's funds and transfer them to others for lending.
4. The interest of legal private lending shall not exceed the upper limit stipulated by the state (4 times the interest rate of bank loans in the same period), and the excess shall be invalid.
5. The legitimate purpose of private lending must be legitimate, and it is not allowed to provide loans for others to engage in illegal activities.
The lender knows that the borrower borrows money for illegal activities, such as illegally providing gambling funds, smuggling funds, providing escape funds for criminal suspects, etc., and its lending relationship is not protected; If both parties illegally borrow money, their property may be confiscated, fined or detained; Anyone suspected of committing a crime shall be investigated for criminal responsibility according to law.
6. Legal private lending does not include inter-enterprise lending. Inter-enterprise lending does not belong to the category of private lending, and it is invalid because it violates financial regulations.
However, the loan between citizens and enterprises belongs to legal private lending, such as citizens lending money to enterprises, or enterprises lending money to citizens.
7. Other lending behaviors that violate laws and administrative regulations are invalid.
At the same time, Bian Xiao also wants to remind both borrowers and lenders that if a borrower borrows money for illegal activities, the law will judge it as an illegal lending relationship. Lenders will be investigated for legal responsibility. If you want to start a private lending company. You need to obtain a license from the industrial and commercial bureau to operate legally.
Extended reading:
Judicial interpretation of hearing private lending
Legal interpretation of private lending
Draft for comments on judicial interpretation of private lending