Legal analysis: According to the latest regulations of the People's Bank of China, if the borrower fails to repay the loan as agreed in the contract, the current default interest rate will be changed from the current daily interest rate of 2. 1% to 30%-50% higher than the loan interest rate agreed in the loan contract. The interest rate of overdue loans of the People's Bank of China refers to the penalty interest arising from overdue loans, specifically the penalty interest arising from the lender's failure to repay the loan as agreed in the contract. The general standard is to increase the penalty interest by 30%-50% on the basis of the original loan interest rate. The specific algorithm depends on each overdue situation, and is subject to the Notice of the People's Bank of China on Issues Related to RMB Loan Interest Rate.

Legal Basis: Provisions of the Supreme People's Court on Several Issues Concerning the Application of Laws in the Trial of Private Lending Cases (2020) Article 26 If the lender requests the borrower to pay interest at the interest rate agreed in the contract, the people's court shall support it, except that the interest rate agreed by both parties exceeds four times the market price of one-year loan at the time of the establishment of the contract.