General Electric Co., the world's largest provider of private-label credit cards, said Tuesday it is considering the sale of its Japanese consumer-credit unit, Lake Co.

The U.S. company's possible exit from Japan's $170 billion consumer-finance industry follows an increase in bad loans after the government and courts reduced the maximum interest that can be charged and cracked down on collection tactics.

"Now is an appropriate time to evaluate various alternatives that are in the best interest of both our business and Lake's long-term success," Robert Rendine, a GE spokesman, said by e-mail. "Much has changed in the Japan consumer-finance market over the last few years."

With about ¥860 billion of outstanding loans, Lake ranks sixth among consumer lenders in Japan, according to data from the Liaison Group of Consumer Finance Companies.

Lake said in March it would close 60 percent of its branches and cut its payroll by as much as 15 percent as part of a restructuring plan.

Lawmakers took aim last year at consumer lenders after aggressive marketing created a cycle of debt, with borrowers obtaining loans from one firm to repay another. A law was passed in December capping the maximum interest rate at 20 percent, down from 29 percent. Firms were also required to set aside more reserves against claims for interest refunds.