But, establishing a lower-than-market interest rate by means of a usury ceiling will also bring about a decrease in the quantity of credit supplied. Given lenders costs, the amount of credit they will provide when the interest rate is held down is limited. Like any other business, if a lender does not recoup its costs and earn an adequate return on its resources, it will put those resources to work elsewhere. Since the amount of credit offered will not satisfy all those who are willing to borrow at the ceiling price, excess demand is created, giving rise to a situation in which the reduced amount of credit.
