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Lending should be standardized of sunshine

private lending is a useful complement to the formal

the customs official said, currently in China's legal system there is no "borrowing" this concept, it is relative to the normal financial terms, refers to the State law authorized the establishment of financial institutions other than natural persons, legal persons and other organizations such as the economic subject between the borrowing and lending of funds. Private lending is the social economy develops to a certain stage, businesses and accumulate personal wealth, capital financial capital transformation, formal financial cannot fully meet the needs of society, the result of many factors, with a certain inevitability.

compared with formal financial institutions in financing, private finance has its own characteristics and advantages, such as information collection and processing costs low, procedures are convenient, flexible, low transaction costs, flexible loan collection and special risk control mechanism, and so on. Can say that borrowing is useful and necessary complement of informal finance. To some extent, resolve some of the financing needs of the community.

private lending system legitimacy

the customs official said, private lending has the legitimacy of the system. General principles of civil law, contract law and other laws and regulations to build private lending legal existence and development of the legal and institutional environment. Premise in compliance with relevant laws and regulations, natural persons, legal persons and other organizations have the right to borrow freely. Without prejudice to mandatory provisions of the law, private lending relationship is protected by law. Default can be negotiated or resolved through civil channels.

as with other economic activities, private lending is associated a number of criminal acts, primarily by the public security and judicial departments through administrative and judicial means to punish and combat. Illegal pooling of public deposits, capital markets fraud, usury lending, money laundering, financial pyramid schemes, collection of violence lead to personal injury and criminal behavior should be severely punished according to the relevant laws and regulations and punish.

in response to definition of loan-sharking, extortionate interest rates when penalties and other issues in China, the official said, according to the Supreme People's Court on the case of borrowing people's court opinions provided, private lending rates may be higher than the bank interest rate appropriately, all over the people's Court in accordance with the actual situation of the region specific master, but shall not exceed a maximum of similar Bank loan rates 4 times. Beyond this limit, the excess interest will not be protected. Debit dispute due to interest rates, such as high interest rates, the judiciary can be based on the General principles of civil law, contract law and equitable principles, the principle of good faith determine the validity of the contract and the rights and obligations of the parties. For an individual or a unit to loan for the purpose of profit, acquiring financial institutions credit usurious lending to others, large sum of illegal earnings, according to the provisions of article 175th, punished the crime of usury lending.

private lending needs legal guidance

he said borrowing is a useful and necessary complement of informal finance, however, private lending outside the formal financial, there are deals hidden, risk is not easy to monitor and breed illegal fund-raising, money laundering issues, which need to amend and improve relevant laws and regulations to guide and regulate.

private lending, should be treated differently, classifying management: one is to protect reasonable and legitimate private lending. Second is the investment advisory activities of companies, security companies and other institutions in and around the Government and financial regulators to strengthen supervision and guidance. Third, illegal absorbing public savings, capital markets fraud such as illegal fund-raising, usurious lending, financial pyramid schemes, money-laundering, violence collection lead to crimes such as personal injury, public security and judicial departments to crack down.

departments over the years great concern and attention to nurture, development loans and retail markets. The next step will be committed to improve related laws and regulations, guide specification for private capital to engage in borrowing and lending of funds to encourage lending operation standardization, Sun, develop a multi-level credit markets, meet the financing needs of the community.



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