Paragraph 3: Usury rates

The definition of the usury rate is set out in articles L. 314-6 to L. 314-9 of the French Consumer Code, reproduced below: “Art. L. 314-6- A usurious loan is any contractual loan granted at an overall effective rate which, at the time it is granted, exceeds by more than one third the average effective rate charged during the previous quarter by credit institutions and finance companies for transactions of…

For account overdrafts, a usurious loan to a natural person acting for business purposes or to a legal person engaged in an industrial, commercial, craft, agricultural or non-commercial professional activity is any contractual loan granted at an overall effective rate which, at the time it is granted, exceeds by more than one third the average effective rate charged during the previous quarter by credit institutions or finance companies for transactions…

Where a contractual loan is usurious, the excessive sums collected in accordance with articles L. 313-4 and L. 313-5-1 are automatically deducted from the normal interest and, subsidiarily, from the principal of the debt. If the principal and interest of the claim are extinguished, the sums unduly collected must be returned with statutory interest from the day they were paid.