Shadow Banking for Cash-Strapped Entrepreneurs: A Study of Private Lending Agreements Under Chinese Contract Law
Journal of Business Law (2018), Issue 3, pp. 216-229, Sweet & Maxwell, ISSN: 0021-9460
14 Pages Posted: 15 Oct 2017 Last revised: 23 Mar 2018
Date Written: March 1, 2018
This article discusses and analyses one of the most popular commercial contracts in China: private lending agreement. It refers to moneylending arrangements between a business borrower and its debt investors. Millions of private businesses in China, having limited access to the state-dominated banking sector, rely on private financing to borrow funds. The market volume of the private lending sector amounts to CNY 4 trillion (USD 580.6 billion). In 2014, there were 1.02 million private lending-related civil cases heard by Chinese courts.
Keywords: Contract law, commercial contract, private lending, private financing, China, shadow banking, corporate finance, financial regulation
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