# § 85. Rate of interest on loans, discounts and purchases
Any association may take, receive, reserve, and charge on any loan or discount made, or upon any notes, bills of exchange, or other evidences of debt, interest at the rate allowed by the laws of the State, Territory, or District where the bank is located, or at a rate of 1 per centum in excess of the discount rate on ninety-day commercial paper in effect at the Federal reserve bank in the Federal reserve district where the bank is located, whichever may be the greater, and no more, except that where by the laws of any State a different rate is limited for banks organized under State laws, the rate so limited shall be allowed for associations organized or existing in any such State under title 62 of the Revised Statutes. When no rate is fixed by the laws of the State, or Territory, or District, the bank may take, receive, reserve, or charge a rate not exceeding 7 per centum, or 1 per centum in excess of the discount rate on ninety day commercial paper in effect at the Federal reserve bank in the Federal reserve district where the bank is located, whichever may be the greater, and such interest may be taken in advance, reckoning the days for which the note, bill, or other evidence of debt has to run. The maximum amount of interest or discount to be charged at a branch of an association located outside of the States of the United States and the District of Columbia shall be at the rate allowed by the laws of the country, territory, dependency, province, dominion, insular possession, or other political subdivision where the branch is located. And the purchase, discount, or sale of a bona fide bill of exchange, payable at another place than the place of such purchase, discount, or sale, at not more than the current rate of exchange for sight drafts in addition to the interest, shall not be considered as taking or receiving a greater rate of interest.
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**Source Credit**: (R.S. § 5197; June 16, 1933, ch. 89, § 25, 48 Stat. 191; Aug. 23, 1935, ch. 614, title III, § 314, 49 Stat. 711; Pub. L. 93–501, title II, § 201, Oct. 29, 1974, 88 Stat. 1558; Pub. L. 96–104, title I, § 101, Nov. 5, 1979, 93 Stat. 789; Pub. L. 96–161, title II, § 201, Dec. 28, 1979, 93 Stat. 1235; Pub. L. 96–221, title V, § 529, Mar. 31, 1980, 94 Stat. 168.)
## Editorial Notes
### References in Text
Title 62 of the Revised Statutes, referred to in text, was in the original “this Title” meaning title LXII of the Revised Statutes, consisting of R.S. §§ 5133 to 5244, which are classified to this section and sections 16, 21, 22 to 24a, 25a, 25b, 26, 27, 29, 35 to 37, 39, 43, 52, 53, 55 to 57, 59 to 62, 66, 71, 72 to 76, 81, 83, 84, 86, 90, 91, 93, 93a, 94, 141 to 144, 161, 164, 181, 182, 192 to 194, 196, 215c, 481 to 485, 501, 541, 548, and 582 of this title. See, also, sections 8, 333, 334, 475, 656, 709, 1004, and 1005 of Title 18, Crimes and Criminal Procedure. For complete classification of R.S. §§ 5133 to 5244 to the Code, see Tables.
### Codification
R.S. § 5197 derived from , , which was the National Bank Act. See .
, cited as a credit to this section, was repealed by , effective at the close of . The amendment of this section by that repealed provision, described in the 1979 Amendments note below, shall continue in effect for limited purposes pursuant to section 529. See Savings Provisions note, describing the provisions of , set out below.
, cited as a credit to this section, was repealed by , effective at the close of . The amendment of this section by that repealed provision, described in the 1979 Amendments note below, shall continue in effect for limited purposes pursuant to . See Savings Provisions note, describing the provisions of , set out below. The amendment by , was duplicated with identical language in the amendment made by . See 1979 Amendments note below.
, cited as a credit to this section, was repealed by , , . The amendment of this section by that repealed provision, described in the 1974 Amendment note set out under this section, was duplicated in 1979 with identical language under . See 1979 Amendments note below.
### Amendments
1980— repealed and title II of , resulting in the striking out of “or in the case of business or agricultural loans in the amount of $25,000 or more, at a rate of 5 per centum in excess of the discount rate on ninety-day commercial paper in effect at the Federal Reserve bank in the Federal Reserve district where the bank is located,” before “whichever may be the greater” in two places. See Codification and 1979 Amendment notes under this section.
1979— inserted provisions relating to a 5 per centum interest rate on business or agricultural loans in the amount of $25,000 or more that were identical to provisions inserted earlier by . See Codification note above.
substituted “or in the case of business or agricultural loans in the amount of $25,000 or more, at a rate of 5 per centum in excess of the discount rate on ninety-day commercial paper in effect at the Federal Reserve bank in the Federal Reserve district where the bank is located, whichever may be the greater” for “whichever may be the greater” in two places. See Codification note above.
1974— substituted “or in the case of business or agricultural loans in the amount of $25,000 or more, at a rate of 5 per centum in excess of the discount rate on ninety-day commercial paper in effect at the Federal Reserve bank in the Federal Reserve district where the bank is located, whichever may be the greater” for “whichever may be the greater” in two places.
1935—Act , inserted third sentence.
1933—Act , authorized interest at the alternative rate of 1 per centum in excess of the discount rate on ninety-day commercial paper in effect at the federal reserve bank in the Federal reserve district where the bank is located if greater.
## Statutory Notes and Related Subsidiaries
### Effective Date of 1980 Amendment
, , , provided that the amendment made by that section is effective at the close of .
### Effective Date of 1979 Amendments
, , , which provided that amendment by was applicable to loans made in any State during the period beginning on , and ending on the earliest of (1) in the case of a State statute, ; (2) the date, after , on which such State adopts a law stating in substance that such State does not want the amendment of this section made by to apply with respect to loans made in such State; or (3) the date on which such State certifies that the voters of such State, after , have voted in favor of, or to retain, any law, provision of the constitution of such State, or amendment to the constitution of such State which prohibits the charging of interest at the rates provided in the amendment of this section by , was repealed by , , .
, , , which provided that amendment by was applicable to loans made by any State during the period beginning on , and ending on the earlier of , or the date after , on which such State adopts a law stating in substance that such State does not want the amendment of this section to apply with respect to loans made in such State, or the date on which such State certifies that the voters of such State have voted in favor of, or to retain, any law, provision of the constitution of such State, or amendment of the constitution of such State, which prohibits the charging of interest at the rates provided in the amendment of this section, was repealed by , , .
### Effective and Termination Dates of 1974 Amendment
, , , which provided that amendment by applicable to loans made in any state after , but prior to the earlier of , or the date (after ) of enactment by the state of a law prohibiting the charging of interest at the rates provided in the amendment of this section, was repealed by , , .
### Savings Provisions
, , , provided in part that, notwithstanding the repeal of and title II of , the provisions added to this section by those repealed laws shall continue to apply to any loan made, any deposit made, or any obligation issued in any State during any period when those provisions were in effect in such State.
, , , provided in part that, notwithstanding the repeal, effective at the close of , of [which had enacted sections 86a, 371b–1, 1730e, and 1831a of this title, amended sections 85, 1425b, and 1828 of this title and , Commerce and Trade, repealed sections 371b–1, 1730e, and 1831a of this title and notes set out under sections 371b–1 and 1831a of this title, and enacted provisions set out as notes under this section and sections 86a, 371b–1, and 1831a of this title], the amendment which had been made by title I of and the provisions of that title would continue to apply to any loan made in any State on or after , but prior to the repeal of , and that the amendments made by title II of would continue to apply to any deposit made or obligation issued in any State on or after , but prior to the repeal of .
, , , provided in part that, notwithstanding the repeal of titles II and III of [which had enacted sections 371b–1, 1730e, and 1831a of this title, amended sections 85, 1425b, and 1828 of this title, and , Commerce and Trade, and enacted provisions set out as notes under sections 371b–1 and 1831a of this title], the amendments which had been made by title II of that Act and the provisions of such title would continue to apply to any loan made in any State during the period specified in section 206 of such Act [set out as a note under ] and that the amendments which had been made by title III of such Act would continue to apply to any deposit made or obligation issued in any State during the period specified in section 304 of such Act [set out as a note under ].
### Choice of Highest Applicable Interest Rate
In any case in which one or more provisions of, or amendments made by, title V of [enacting sections 86a, 1730g, 1735f–7a, 1785(g), and 1831d of this title and , Commerce and Trade, and enacting provisions set out as notes under sections 86a, 1730g, and 1735f–7 of this title], , or any other provisions of law, including this section, apply with respect to the same loan, mortgage, credit sale, or advance, such loan, mortgage, credit sale, or advance may be made at the highest applicable rate, see , set out as a note under .
### States Having Constitutional Provisions Regarding Maximum Interest Rates
, , , provided that the provisions of title II of , which amended this section, repealed provisions which had formerly amended this section, and enacted provisions set out as notes under this section, to continue to apply until , in the case of any State having a constitutional provision regarding maximum interest rates.