An official at the People’s Bank of China (PBoC) said the central bank would submit plans to change regulations regarding non-bank private lending firms and remove interest rate ceilings, the Wall Street Journal reported. Zhou Xuedong, the director general of the PBoC’s law and regulation department said that the changes would help to encourage private businesses that have had difficulty securing loans from state-owned banks. Private lending firms have existed in a legal gray area; the new plans would legalize them. "We should acknowledge the facts, let these firms emerge from underwater to enjoy the sunshine and remove the restrictions," said Zhou. The removal of interest rate ceilings would affect caps on interest rates charged by microlending firms, introduced to prevent predatory lending.
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