Chuo Mitsui Trust and Banking Co. and Nissin Co. agreed to form a joint venture focusing on loans for smaller businesses.
The new firm is expected to offer unsecured loans carrying annual rates of 15 per cent to 19.8 per cent.
Chuo Mitsui Trust will own 70 per cent of the venture, which will be capitalised at 500 million yen (US$4.7m), and Nissin will own the remainder.
Due to start operating as early as January, it aims to have an outstanding loan balance of 20-30 billion yen in three years.
Targeted borrowers will be smaller companies and individual entrepreneurs that have been in business for more than three years.
The planned firm's uncollateralised loans will be for 500,000 yen to 5 million yen. Real estate-backed loans will range from 5 million yen to 1 billion yen, with annual rates of 5-11 per cent.
Source: Asia Pulse
