A private loan is a direct loan from one private individual or entity to another, without an intermediary such as a bank or other institutional lender. Typically, private loans are cash loans given by individuals to relatives, friends or acquaintances. However, loans brokered between private lenders and borrowers by loan brokers such as peer to peer lending platforms are also private loans.
In Switzerland, private loans are not subject to the Swiss consumer credit law which governs consumer loans, such as personal loans from banks and credit card loans from credit card issuers. As such, the interest rates, terms and conditions of private loans are decided entirely by the borrower and the lender. These can be set forth in a private loan contract if desired. Repayment of private loans is governed by Swiss laws governing debt collection.
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