Where insufficient credit is being provided to a particular industry that is of strategic importance to the economy, interest rate caps can be a short term solution.
In response to this asset liability mismatch, libertarians and free-market advocates called for interest rate caps to be increased or repealed entirely as an unreasonable restriction on market forces.
While some countries use a vanilla interest rate cap written into all regulations for licensed financial institutions, others have attempted a more flexible approach.
The government originally proposed an interest rate cap for all loans, which would have meant the end of some financial institutions that specialize in personal loans.