Japan may be in the midst of a silent epidemic of kinketsu-byo ("lack of money disease"). The source of the infection is a new statute that bans many borrowers from obtaining unsecured loans.
While the full repercussions of the revised Money Lending Business Law (MLBL), which was passed in 2006 but went into force on June 18, are still unclear, the law's impact appears likely to affect discretionary spending by hundreds of thousands, if not millions, of people who are no longer eligible to borrow. It is feared that many, desperate for a short-term infusion of cash, will turn to illegal loan sharks.
Two days before the new law took effect, the Sankei newspaper (June 16) had reported "chaos" at ATMs, with customers besieging sarakin (consumer loan) companies. Many borrowers, a good deal of whom appeared to be housewives, were caught unaware of the impending law. This was due, in many cases, to the sarakin firms' inability to notify them about the new law by mail or telephone, in some cases because the borrowers had taken out loans without the knowledge of their spouses.