Categories: Banking Law and Financing
As indicated by Law 7472 “Promotion of Competition and Effective Consumer Defense”, the Central Bank of Costa Rica is the entity in charge of calculating and establishing the limits of the maximum interest rates, twice a year, in January and July. The definition of these maximum limits for interest in colones, dollars and other currencies is important, since the requirement of disproportionate rates, above this reference, is what will be constituted with the crime of usury, which will have a penalty ranging from 6 months to 2 years in prison, or a fine of 20 to 80 days.
In compliance with the provisions of the Law, on July 3, the BCCR published the maximum annual interest rates for credit operations in colones, dollars and other currencies. For all types of credits, the banking authority established the following limits:
– Credits in colones: 37.69%
– Credits in dollars: 30.36%
– Microcredits in colones: 53.18%
– Microcredits in dollars: 42.99%
– Credits in other currencies: 7.44%
It is important that credit institutions consider these caps or maximum limits, since, as indicated, the requirement of interests above the established could have criminal consequences.
For the calculation of these active interest rates, the BCCR used the simple average of the active interest rates (those of the loans) negotiated monthly for the previous 12 months (the period from July 2019 to July 2020).
Another important aspect that both consumers and financial entities must consider is that, as established by the new Law, the limits or caps on interest rates will not apply to credits that have been formalized prior to the entry into force of the Law; that is, they will not apply to all those credits that were formalized before June 20 of this year.
Before being able to offer and formalize a credit, the offeror must request the potential debtor an authorization to gain access to the SUGEF Credit Information Center; likewise, it must provide the user, in advance, all the credit information in writing, in a clear and updated manner regarding the interest rate that will be used in the operation.
If you require advice on this law, at ERP Lawyers we have a specialized team on the matter. Do not hesitate to contact us!
