Chapter 32 Beware of falling into economic disputes

In late June 2008, the People's Court of Lucheng District, Wenzhou City received an economic dispute about private lending. The matter is very simple: the defendant, the owner of a clothing company, borrowed 1.2 million yuan from the plaintiff.The two parties agreed in advance that the sum should be paid off in two installments. The first installment of 600,000 yuan should be returned on March 5, 2008, and the second installment of 500,000 yuan should be returned on April 5, 2008. At first glance, it should be clear how this case is judged, as long as both parties fulfill their responsibilities and obligations according to the contract.But the insider revealed that things are not as simple as the lock on the surface.Because all the procedures between the two parties are just an IOU.This IOU clearly stated that the defendant borrowed 1.2 million yuan from the plaintiff, but in fact, only 900,000 or even 800,000 yuan was not enough, and the excess part belonged to interest.Obviously, this private lending business is a bit usury in nature.The defendant was likely to be unable to raise money under the premise of urgent need for funds, so he had to borrow money through underground banks.However, his business may not be as optimistic as originally estimated in advance, and the payment cannot be returned when it is due. When a new agreement cannot be reached with the plaintiff, it can only be resolved through legal means.

Similar private lending disputes are not uncommon in Wenzhou. The occurrence of this phenomenon is not because the credit of Wenzhou people has been reduced, nor is it that Wenzhou's private lending business has reached a point where it cannot be controlled.The fundamental reason is that for Wenzhou people, there are too many borrowers and too many people who are borrowed. As the saying goes, Wenzhou people "loan usury all over the city".To use an inappropriate metaphor: If you walk too much at night, you will always encounter ghosts.The existence of everything has reached the level of universality. Before the corresponding legal policies have been introduced, interest disputes will inevitably arise in the fiery capital lending market in Wenzhou.

In fact, under the situation of "loan usury all over the city", it is impossible to avoid it even if you want to.Because in the concept of Wenzhou people, borrowing is an investment project, just like producing a certain commodity. Money has become a special "commodity" that circulates between borrowers and lenders.Some moneylenders sell the loan business just like they want to sell general commodities for the funds under their hands. For example, some people may sometimes receive such inexplicable text messages: "Do you need money urgently? XX Group will handle it for you for a long time (monthly interest rate 3% annual interest rate 10%) without guarantee or mortgage. It will be handled for you on the same day , Loan will be released on the same day. For details: 13XXXXXXXX, a manager." Or someone who speaks standard Mandarin will call you: "Hello, I am XXXXX financial investment institution, and our company specializes in providing you with unsecured loans..." When you open the newspaper, there are all kinds of loan business, and the advertisements of various guarantee companies and investment companies are actually partly of this nature.

In short, the amount of private capital in Wenzhou is huge. If Wenzhou businessmen urgently need funds for turnover, even if they do not go through banks, they will not worry about not having no channels for borrowing. The point is, for borrowers, how to raise money is reliable, so as to avoid the trap of usury.On the other hand, for the lender, what kind of person the money is released to can be recovered within the specified time without disputes. A benign lending relationship, whether it is a borrower or a lender, must consider all aspects of the situation, at least these factors cannot be ignored:

1. Know yourself and the enemy, and measure comprehensively. For this kind of private lending by Wenzhou people, the state has not yet issued relevant laws and policies.The way Wenzhou people restrain themselves is just a simple IOU and receipt.If you are an acquaintance, you may not even have these most basic receipts, and everything depends on the constraints of moral force. In this way, problems between lenders and borrowers are prone to problems. Therefore, whether it is a lender or a lender, it is best to conduct a comprehensive investigation on the other party before entering into a loan relationship.

A boss Xie said: "I usually don't borrow money from strangers who come to my door automatically, even if the interest rate is high. The risk is too great. Most of the customers I lend money to are introduced by acquaintances or acquaintances. At least I need to know the other party. I know how well his business is doing. In addition, even if I am an acquaintance, if the loan amount is relatively large, I must fully understand all the circumstances before deciding whether to lend. A friend once introduced me to a client and asked It is very big, and we need to borrow 10 million. This client is doing foreign trade in Dubai. There are more than 20 shops in the local area for sale. He plans to buy them all, but he is short of funds, so he came to me. This is a big business , the profit is huge, but the risk is also huge. I took a trip to the Middle East with this client, visited many Wenzhou fellows, and learned that investing in real estate here is a very good project, so I lent it to him. Three Months later, the customer’s store was successfully transferred, and the money was repaid to me immediately.”

Boss Xie's caution is worth learning from. Private lending has a trend of "blossoming everywhere" in Wenzhou. Although there are many bosses who need capital turnover, there are also many lenders, and the competition in the industry is fierce.Sometimes the bosses of some banks are eager for quick success and quick profits in order to grab business. When they see customers coming to the door, they will lend money hastily.If you encounter a customer who is unable to repay the loan, it is prone to economic disputes. For borrowers, it is best to consider their own recognition ability before borrowing money, and not to borrow money blindly for the sake of urgency.If the project you run is only owed a sum of money, it will start to improve as soon as the money arrives.In this case, if there is no better way to raise funds, it would be a good way to go through private reception.If the project you are operating is facing many problems temporarily, which cannot be solved with a sum of money, then it is best not to seek private loans.One is that the interest rate is too high, and the profits earned by one's own business may accidentally fill in the holes, and the gains outweigh the losses.The worse result is that your business does not improve because of this money, and the consequences are even worse.Therefore, even if there are lenders everywhere in Wenzhou, or your mobile phone often receives information about free loans, don’t be easily tempted, lest you accidentally fail to end up.

2. It is best to have a guarantor or something that can be mortgaged. We know that to get a loan from a bank, you either have something as collateral or someone guarantees it.In this way, in case of any accident, the bank can at least reduce some losses.The borrowing methods of Wenzhou people should also have such an intermediate buffer zone. When the borrower and the lender have a loan relationship, the guarantor or collateral must play a certain role. For example, if A urgently needs a sum of money and wants B to borrow money, in addition to signing the necessary procedures, it is best to find someone C whom both parties know as a guarantee.Because C is familiar with the situation of both parties, he can determine whether A can repay the loan in time, and can also confirm that the interest of B's ​​loan is in line with industry regulations, and there will be no excessive interest.This can greatly increase the repayment rate.

In order not to embarrass C, the form of this guarantee does not have to be as rigorous as that of a bank, and he does not need to bear the responsibility for repayment in case of an accident.The main content of C's guarantee can be A's personality.Once A fails to repay the loan on time, it will be like borrowing money from the Chamber of Commerce and not repaying it. His reputation will be ruined immediately, and he will not be able to gain a foothold in the circle of Wenzhou people since then. As for the collateral, what needs to be mortgaged is not easy to explain in detail.Both parties to the loan should discuss beforehand that if the loan cannot be repaid in time, A should offer something as compensation, and this compensation should also be agreed by B, so as to avoid the possibility that the value of the collateral is too low to mortgage the loan.Finally, the mortgage situation is the same as the contract, clearly written in black and white.

3. Both borrowers and lenders must understand one thing: borrowing and lending are not the purpose, but the purpose is to achieve a win-win situation for both parties. The reason why Wenzhou capital can accumulate so quickly in the past 20 to 30 years is that Wenzhou people help each other and do things together, so that the idle funds can be gathered, so that they can be used to invest in larger projects and obtain more profits . The opposite of Baotuan is fighting in the nest.The economic disputes between Wenzhou people because of the loan relationship are actually a kind of fighting in the nest. The result of the fighting not only hurts the peace, but also is not conducive to the further operation of capital.

Therefore, for lenders, although lending has become a new type of investment project, the significance of this project is to benefit everyone and realize a virtuous circle of capital in the entire Wenzhou circle.Rather than just blindly raising interest rates for your own profit, it will ultimately be detrimental to others and yourself. For borrowers, they should strictly restrain themselves and not be easily tempted by underground banks to borrow money whenever there is a shortage of funds.You should first think of other emergency measures, and look for relatives and friends, chambers of commerce, or see if there is anything that can be mortgaged to the bank.When it is not a last resort, don't easily go to underground banks to borrow money.Although it is easy to raise capital there, the consequences are also very serious. Maybe the money you have worked hard for a long time has been filled into high interest rates.