A lawmaker has downplayed the real effects of the recent decision by the Money and Credit Council to cut interest rates, saying that lack of transparency by certain businesses hampers initiatives to regulate the market.
Elias Naderan, who is a member of the budget committee in the parliament, expressed doubt that the recent rate cut by the central bank would be even fully implemented by banks and financiers, ICANA, the parliamentary news agency, reported.
“We should note that the Money and Credit Council does not have a true perception of the monetary problems since deposit rates are not the whole problem”, Naderan said.
He added that the regulatory council can only recommend an interest rate ceiling and not enforce one and instead called on the Central Bank to step up its crackdown on unauthorized banks and irregular financial businesses. “The council ought to do more than merely changing interest rates “, he said.
Last week, the MCC put a 20 percent cap on deposit rates and a 24 percent cap on business loans.
