Interest Rate ceilings
Interest rate ceilings are limits set by governments or financial regulators on how high interest rates can be charged on loans or credit. The aim is to protect consumers from excessively high borrowing costs, making loans more affordable. While a ceiling can help borrowers, it can also lead to unintended consequences, such as reduced availability of credit, as lenders may be less willing to offer loans at lower rates. Essentially, it's a balancing act between protecting consumers and ensuring that lenders can still operate profitably.
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Interest rate ceilings are legal limits set by governments or regulatory bodies on how high interest rates can be for loans or credit. These ceilings aim to protect consumers from excessively high borrowing costs, making loans more affordable. While they can help prevent exploitation, if set too low, they might deter lenders from offering loans altogether, leading to reduced access to credit. Essentially, interest rate ceilings balance consumer protection with the need for lenders to operate profitably.