Russia's State Duma approved a bill that will gradually cap interest rates, fees and penalties on consumer and microfinance loans, Rambler.ru portal reported Dec. 19.

The law provides for gradually reducing the maximum amount of fines and interest that can be calculated on consumer loans issued for a period of up to one year. The cap will be set at 2.5x the initial value as of when the law is enforced, and will be gradually lowered to 1.5x from January 2020.

In addition, maximum interest rates on such loans will be capped at 1.5% per day after the law is implemented and will drop further to 1.0% a day from July 2019.

The legislation, passed at its third reading, also aims to eliminate illegal creditors from the market.