What Is a Per Diem Interest?
Loan interest refers to the remuneration received by the lender from the borrower for issuing monetary funds, and is also the price that the borrower must pay to use the funds. The bank loan interest rate refers to the ratio of the amount of interest to the principal amount during the borrowing period. The interest rate of a loan contract with a financial institution such as a bank as the lender is determined. The parties can only negotiate within the upper and lower limits of the interest rate stipulated by the People's Bank of China. If the loan interest rate is high, the repayment amount of the borrower will increase after the borrowing period, otherwise it will decrease. Three factors determine loan interest: loan amount, loan term, and loan interest rate.
Loan interest
(1) The interest rate conversion formula for RMB business is (Note: deposit and loan are universal):
1. Daily interest rate (0/000) = annual interest rate (%) ÷ 360 = monthly interest rate () ÷ 30
2. Monthly interest rate () = annual interest rate (%) ÷ 12
(2) Banks may use the cumulative interest method and the interest method to calculate interest.
1. Accumulated interest calculation method accumulates the daily account balance based on the actual number of days, and calculates the interest by multiplying the accumulated number by the daily interest rate. The interest calculation formula is:
Interest = cumulative interest-bearing products × daily interest rate, of which cumulative interest-bearing products = daily balance total.
2. Interest-by-interest method calculates interest on a case-by-case basis according to a pre-determined interest-calculation formula. Interest = principal × interest rate × loan term. There are three specific:
If the interest calculation period is the whole year (month), the interest calculation formula is:
Interest = principal x years (months) x annual (months) interest rate
If the interest accrual period has a whole year (month) and a fraction of days, the interest accrual formula is:
Interest = principal x years (months) x annual (months) interest rate + principal x fractional days x daily interest rates
At the same time, the bank can choose to convert the interest calculation period into actual days to calculate interest, that is, 365 days per year (366 days in a leap year), and each month is the actual number of days in the Gregorian calendar. The interest calculation formula is:
Interest = principal x actual days x daily interest rate
These three calculation formulas are essentially the same, but since the interest rate conversion only takes 360 days a year, when the actual interest rate is calculated, the year will take 365 days to calculate, and the results obtained will be slightly biased. Which formula is used specifically to calculate, the central bank has given financial institutions the right to make their own choices. Therefore, the parties and financial institutions can agree on this in the contract.
(3) Compound interest: Compound interest means to add interest to interest at a certain rate. According to the provisions of the central bank, if the borrower fails to repay the interest within the time agreed in the contract, compound interest will be charged.
(4) Penalty interest: The lender fails to repay the bank loan within the prescribed period, and the penalty interest on the defaulter according to the contract signed with the parties is called the bank penalty interest.
(5) Overdue liquidated damages for loans: the nature is the same as penalties and penalties for the defaulting party.
(6) Formulation and filing of interest calculation methods
The national commercial bank legal person's calculation and settlement rules and the method of interest calculation for deposit and loan business shall be reported to the head office of the People's Bank of China and notified to customers; regional commercial banks and urban credit cooperatives shall be reported to the People s Bank of China branch, provincial capital (capital) cities The central branch records and informs the customers; the rural credit cooperative county federation legal person can formulate the calculation and settlement rules and interest calculation methods of the deposit and loan business according to the actual situation of the county rural credit cooperative, and report it to the People's Bank of China branch, the provincial capital (capital) city center Sub-branch for the record, and the rural credit cooperative legal person will inform the customer.
(VII) Reference basis:
1. "Regulations on the Management of RMB Interest Rates" Yinfa [1999] No. 77.
2. "Circular of the People's Bank of China on Issues Concerning the Interest Rate of RMB Loans" Yinfa [2003] No. 251.
3. Notice of the People's Bank of China on the Calculation and Settlement of Interest on RMB Deposits and Loans Yinfa [2005] No. 129.
The interest payment on a loan is perfectly justified, but the interest must be paid before the loan can be processed. Now, there are a lot of eye-catching small advertisements on the Internet, such as "only applying for an ID card to make a loan, making a loan on the same day, no mortgage, no guarantee" and so on. It is these attractive small ads that make those in need of capital "accidentally".
Paying interest on loans first is a common practice of many loan scammers. Formal lenders do not require payment in advance. Special attention should be paid to off-site loans and so-called lending after paying interest on loans, which may all be irregular loans. When applying for a loan, the key to applying for a loan is to have a sense of self-risk prevention. Sometimes thinking about it more and calming down will avoid many unnecessary losses.
On October 24, 2015, the People's Bank of China updated the latest benchmark interest rate data.
1. Benchmark interest rates for financial institutions' RMB loans
Adjust the time | Within 6 months (inclusive) | 6 months to 1 year (inclusive) | 1 to 3 years (inclusive) | 3 to 5 years (inclusive) | More than 5 years |
1991.04.21 | 8.10 | 8.64 | 9.00 | 9.54 | 9.72 |
1993.05.15 | 8.82 | 9.36 | 10.80 | 12.06 | 12.24 |
1993.07.11 | 9.00 | 10.98 | 12.24 | 13.86 | 14.04 |
1995.01.01 | 9.00 | 10.98 | 12.96 | 14.58 | 14.76 |
1995.07.01 | 10.08 | 12.06 | 13.50 | 15.12 | 15.30 |
1996.05.01 | 9.72 | 10.98 | 13.14 | 14.94 | 15.12 |
1996.08.23 | 9.18 | 10.08 | 10.98 | 11.70 | 12.42 |
1997.10.23 | 7.65 | 8.64 | 9.36 | 9.90 | 10.53 |
1998.03.25 | 7.02 | 7.92 | 9.00 | 9.72 | 10.35 |
1998.07.01 | 6.57 | 6.93 | 7.11 | 7.65 | 8.01 |
1998.12.07 | 6.12 | 6.39 | 6.66 | 7.20 | 7.56 |
1999.06.10 | 5.58 | 5.85 | 5.94 | 6.03 | 6.21 |
2002.02.21 | 5.04 | 5.31 | 5.49 | 5.58 | 5.76 |
2004.10.29 | 5.22 | 5.58 | 5.76 | 5.85 | 6.12 |
2006.04.28 | 5.40 | 5.85 | 6.03 | 6.12 | 6.39 |
2006.08.19 | 5.58 | 6.12 | 6.30 | 6.48 | 6.84 |
2007.03.18 | 5.67 | 6.39 | 6.57 | 6.75 | 7.11 |
2007.05.19 | 5.85 | 6.57 | 6.75 | 6.93 | 7.20 |
2007.07.21 | 6.03 | 6.84 | 7.02 | 7.20 | 7.38 |
2007.08.22 | 6.21 | 7.02 | 7.20 | 7.38 | 7.56 |
2007.09.15 | 6.48 | 7.29 | 7.47 | 7.65 | 7.83 |
2007.12.21 | 6.57 | 7.47 | 7.56 | 7.74 | 7.83 |
2008.09.16 | 6.21 | 7.20 | 7.29 | 7.56 | 7.74 |
2008.10.09 | 6.12 | 6.93 | 7.02 | 7.29 | 7.47 |
2008.10.30 | 6.03 | 6.66 | 6.75 | 7.02 | 7.20 |
2008.11.27 | 5.04 | 5.58 | 5.67 | 5.94 | 6.12 |
2008.12.23 | 4.86 | 5.31 | 5.40 | 5.76 | 5.94 |
2010.10.20 | 5.10 | 5.56 | 5.60 | 5.96 | 6.14 |
2010.12.26 | 5.35 | 5.81 | 5.85 | 6.22 | 6.40 |
2011.02.09 | 5.60 | 6.06 | 6.10 | 6.45 | 6.60 |
2011.04.06 | 5.85 | 6.31 | 6.40 | 6.65 | 6.80 |
2011.07.07 | 6.10 | 6.56 | 6.65 | 6.90 | 7.05 |
2012.06.08 | 5.85 | 6.31 | 6.40 | 6.65 | 6.80 |
2012.07.06 | 5.60 | 6.00 | 6.15 | 6.40 | 6.55 |
| 2014.11.22 | 5.60 | 5.60 | 6.00 | 6.00 | 6.15 |
| 2015.03.01 | 5.35 | 5.35 | 5.75 | 5.75 | 5.90 |
| 2015.05.11 | 5.10 | 5.10 | 5.50 | 5.50 | 5.65 |
| 2015.06.28 | 4.85 | 4.85 | 5.25 | 5.25 | 5.40 |
| 2015.08.26 | 4.60 | 4.60 | 5.00 | 5.00 | 5.15 |
| 2015.10.24 | 4.35 | 4.35 | 4.75 | 4.75 | 4.90 |
| 2015.08.26 | 4.60 | 4.60 | 5.00 | 5.00 | 5.15 |
| 2015.10.24 | 4.35 | 4.35 | 4.75 | 4.75 | 4.90 |
2. Provident Fund Loan Ratio
Adjust the time | Within 5 years (inclusive) | More than 5 years |
1999.06.10 | 4.14 | 4.59 |
2002.02.21 | 3.60 | 4.05 |
2004.10.29 | 3.78 | 4.23 |
2005.03.17 | 3.96 | 4.41 |
2006.04.28 | 4.14 | 4.59 |
2007.03.18 | 4.32 | 4.77 |
2007.05.19 | 4.41 | 4.86 |
2007.07.21 | 4.50 | 4.95 |
2007.08.22 | 4.59 | 5.04 |
2007.09.15 | 4.77 | 5.22 |
2008.09.16 | 4.59 | 5.13 |
2008.10.09 | 4.32 | 4.86 |
2008.10.27 | 4.05 | 4.59 |
2008.11.27 | 3.51 | 4.05 |
2008.12.23 | 3.33 | 3.87 |
2010.10.20 | 3.50 | 4.05 |
2010.12.26 | 3.75 | 4.30 |
2011.02.09 | 4.00 | 4.50 |
2011.04.06 | 4.20 | 4.70 |
2011.07.07 | 4.45 | 4.90 |
2012.06.08 | 4.20 | 4.70 |
2012.07.06 | 4.00 | 4.50 |
| 2015.10.24 | 2.75 | 3.25 |
3. Benchmark interest rates for financial institutions' RMB deposits
Adjust the time | Current deposit | Time deposit |
Three months | Half a year | One year | Two years | Three years | Five years |
1990.04.15 | 2.88 | 6.30 | 7.74 | 10.08 | 10.98 | 11.88 | 13.68 |
1990.08.21 | 2.16 | 4.32 | 6.48 | 8.64 | 9.36 | 10.08 | 11.52 |
1991.04.21 | 1.80 | 3.24 | 5.40 | 7.56 | 7.92 | 8.28 | 9.00 |
1993.05.15 | 2.16 | 4.86 | 7.20 | 9.18 | 9.90 | 10.80 | 12.06 |
1993.07.11 | 3.15 | 6.66 | 9.00 | 10.98 | 11.70 | 12.24 | 13.86 |
1996.05.01 | 2.97 | 4.86 | 7.20 | 9.18 | 9.90 | 10.80 | 12.06 |
1996.08.23 | 1.98 | 3.33 | 5.40 | 7.47 | 7.92 | 8.28 | 9.00 |
1997.10.23 | 1.71 | 2.88 | 4.14 | 5.67 | 5.94 | 6.21 | 6.66 |
1998.03.25 | 1.71 | 2.88 | 4.14 | 5.22 | 5.58 | 6.21 | 6.66 |
1998.07.01 | 1.44 | 2.79 | 3.96 | 4.77 | 4.86 | 4.95 | 5.22 |
1998.12.07 | 1.44 | 2.79 | 3.33 | 3.78 | 3.96 | 4.14 | 4.50 |
1999.06.10 | 0.99 | 1.98 | 2.16 | 2.25 | 2.43 | 2.70 | 2.88 |
2002.02.21 | 0.72 | 1.71 | 1.89 | 1.98 | 2.25 | 2.52 | 2.79 |
2004.10.29 | 0.72 | 1.71 | 2.07 | 2.25 | 2.70 | 3.24 | 3.60 |
2006.08.19 | 0.72 | 1.80 | 2.25 | 2.52 | 3.06 | 3.69 | 4.14 |
2007.03.18 | 0.72 | 1.98 | 2.43 | 2.79 | 3.33 | 3.96 | 4.41 |
2007.05.19 | 0.72 | 2.07 | 2.61 | 3.06 | 3.69 | 4.41 | 4.95 |
2007.07.21 | 0.81 | 2.34 | 2.88 | 3.33 | 3.96 | 4.68 | 5.22 |
2007.08.22 | 0.81 | 2.61 | 3.15 | 3.60 | 4.23 | 4.95 | 5.49 |
2007.09.15 | 0.81 | 2.88 | 3.42 | 3.87 | 4.50 | 5.22 | 5.76 |
2007.12.21 | 0.72 | 3.33 | 3.78 | 4.14 | 4.68 | 5.40 | 5.85 |
2008.10.09 | 0.72 | 3.15 | 3.51 | 3.87 | 4.41 | 5.13 | 5.58 |
2008.10.30 | 0.72 | 2.88 | 3.24 | 3.60 | 4.14 | 4.77 | 5.13 |
2008.11.27 | 0.36 | 1.98 | 2.25 | 2.52 | 3.06 | 3.60 | 3.87 |
2008.12.23 | 0.36 | 1.71 | 1.98 | 2.25 | 2.79 | 3.33 | 3.60 |
2010.10.20 | 0.36 | 1.91 | 2.20 | 2.50 | 3.25 | 3.85 | 4.20 |
2010.12.26 | 0.36 | 2.25 | 2.50 | 2.75 | 3.55 | 4.15 | 4.55 |
2011.02.09 | 0.40 | 2.60 | 2.80 | 3.00 | 3.90 | 4.50 | 5.00 |
2011.04.06 | 0.50 | 2.85 | 3.05 | 3.25 | 4.15 | 4.75 | 5.25 |
2011.07.07 | 0.50 | 3.10 | 3.30 | 3.50 | 4.40 | 5.00 | 5.50 |
2012.06.08 | 0.40 | 2.85 | 3.05 | 3.25 | 4.10 | 4.65 | 5.10 |
2012.07.06 | 0.35 | 2.60 | 2.80 | 3.00 | 3.75 | 4.25 | 4.75 |
2014.11.22 | 0.35 | 2.35 | 2.55 | 2.75 | 3.35 | 4.00 | & shy; |
2015.03.01 | 0.35 | 2.10 | 2.30 | 2.50 | 3.10 | 3.75 | |
2015.05.11 | 0.35 | 1.85 | 2.05 | 2.25 | 2.85 | 3.50 | |
2015.06.28 | 0.35 | 1.60 | 1.80 | 2.00 | 2.60 | 3.25 | |
2015.08.26 | 0.35 | 1.35 | 1.55 | 1.75 | 2.35 | 3.00 | |
2015.10.24 | 0.35 | 1.10 | 1.30 | 1.50 | 2.10 | 2.75 | |
Note: As of November 22, 2014, the People's Bank of China no longer announces the benchmark interest rate for Renminbi five-year time deposits of financial institutions.
