A key Liberal Democratic Party panel agreed Friday to shorten a transition period for the creation of a single interest-rate ceiling for consumer loans to five years instead of the original nine proposed by the Finance Services Agency, panel members said.
The panel decided to shorten the transition in response to criticism that the long phase-in of single, lower ceiling would hurt people who owe money to more than one lender.
At present, under the Interest Rate Restrictions Law, consumer loan companies can charge no more than 15 percent to 20 percent interest, depending on the size of the loan. But under the Investment Deposit and Interest Rate Law, they can charge up to 29.2 percent if borrowers agree in writing.