If the law stipulates that the borrower fails to repay the loan on time, it needs to pay a certain amount of overdue interest in accordance with the agreement or relevant state regulations.
First, the standard of overdue interest
Branches and business management departments of the People's Bank of China, policy banks, wholly state-owned commercial banks and joint-stock commercial banks:
In order to steadily promote the reform of interest rate marketization and give full play to the regulatory role of interest rate leverage.
The relevant matters concerning RMB loan interest rate and interest settlement are hereby notified as follows:
1. On the interest calculation and settlement of RMB loans. The method of interest calculation and settlement for RMB loans (not applicable to individual housing loans) shall be determined by both borrowers and borrowers through consultation.
2. Adjustment of loan interest rate during the contract period. The interest rate of medium and long-term RMB loans is fixed from the original one year to be determined by both borrowers and borrowers according to commercial principles. During the contract period, it can be adjusted monthly, quarterly and annually, or a fixed interest rate can be adopted.
The interest rate of loans with a term of more than five years shall be determined independently by financial institutions with reference to the interest rate of loans with a term of more than five years published by the People's Bank of China.
3. About penalty interest. The default interest rate of overdue loans (loans that the borrower fails to repay on the date agreed in the contract) is changed from the current daily interest rate of 2. 1% to 30%-50% higher than the loan interest rate agreed in the loan contract; If the borrower fails to use the loan as agreed in the contract, the penalty interest rate will be changed from the current daily interest rate of five ten thousandths to 50%- 100% of the loan interest rate agreed in the loan contract.
For loans that are overdue or not used according to the purpose agreed in this contract, interest will be charged at the default interest rate from the date when they are used in loans overdue or not according to the purpose agreed in this contract until the loan principal and interest are fully paid off. For the interest that cannot be paid on time, compound interest shall be calculated at the penalty interest rate.
Legal basis:
People's Republic of China (PRC) Civil Code
Article 676
If the borrower fails to repay the loan within the agreed time limit, it shall pay overdue interest in accordance with the agreement or relevant state regulations.
Article 677
If the borrower repays the loan in advance, unless otherwise agreed by the parties, the interest shall be calculated according to the actual loan period.
Article 678
The borrower may apply to the lender for extension before the repayment period expires; If the lender agrees, it can be extended.
Article 1260
If the loan contract between natural persons does not stipulate or clearly stipulates the payment of interest, it shall be regarded as non-payment. If the loan contract between natural persons stipulates to pay interest, the loan interest rate shall not violate the relevant provisions of the state on limiting the loan interest rate.