Taiwan Brokers Seek to Raise Non-Restricted-Purpose Lending Cap to 10 Times Net Worth

Non-purpose loans allow investors to borrow from brokerages against stocks and ETFs. With interest rates typically below those on margin financing and applications relatively convenient, the loans have become a source of leverage in Taiwan's stock market. Capital Securities launched its “Capital Super Loan” service at the end of 2023, with outstanding balances rising by more than NT$10 billion in just over three months. Taiwan stocks retreated after its quota was exhausted in July 2024, so the latest capacity crunch has renewed concerns about an overheated market and a potential reversal.

As of April 29, 2026, outstanding market loans reached 16.0244 million lots, the second-highest level on record. The estimated amount borrowed, calculated at 60% of the 60-day average price, hit a record NT$662.8 billion. Cathay Securities, Hua Nan Securities and President Securities were reportedly among the brokerages that had exhausted their quotas. President suspended online applications and shifted to case-by-case reviews, while Hua Nan closed applications after reaching capacity and will raise interest rates from June 1. First Securities was also nearing its limit.