In China private lending cases, there are three crucial points that must be noted. The first is whether the lender is a professional lender. If they are a professional lender, it will affect the outcome of the case. According to China law, an important criterion for determining this is whether they have lent money to more than five different borrowers within a single year.
The second key point is the source of the funds—that is, where the money you are lending came from. For example, if you obtained the money from a bank loan and then relent it to someone else, this lending act is invalid.
The final key point is the issue of the statute of limitations. If three years have passed since the repayment date promised on the IOU, the defendant may raise a defense regarding the statute of limitations. If this defense is successful, the plaintiff could lose the case.
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