The major credit card companies have abolished charges for after-hours cash withdrawals made at automated teller machines in banks because financial regulators are expected to get tough on capping interest rates, industry officials said.
JCB Co., UFJ Nicos Co., UC Card Co. and Sumitomo Mitsui Card Co. discontinued the charges earlier this year, while Toyota Finance Corp. will follow suit around July.
Among other major credit card companies, Aeon Credit Service Co. eliminated the charges last fall.
While credit card companies charge from 105 yen to 210 yen for after-hours withdrawals, interest rates may well top 29.2 percent per annum, the highest permitted by the Investment Deposit and Interest Rate Law, if the charges are combined with their lending rate of 27.8 percent.
Credit card companies have tended to treat the charges separately from interest rates, but are now reviewing this idea since the Supreme Court ruled in January that strict restrictions on the so-called gray zone of interest rates were needed to protect borrowers.
Under the Interest Rate Restriction Law, depending on the amount of money borrowed, annual interest rates exceeding 15 percent to 20 percent are not allowed. Criminal penalties, however, do not apply until the lending rate exceeds the 29.2 percent in the investment deposit law. The shady gray zone falls between those rates and has been the source of anger and complaints from unsuspecting consumers.