Costa Rica: Regulation for Solidary Associations

Regulations are being prepared to supervise the activities of solidarity associations, whose volume of credits is equivalent to that managed by the 7 smallest private banks in the country.

Wednesday, June 21, 2017

At the end of 2016, the volume of loans granted by solidarity associations totaled $6.425 million, according to data provided to Nacion.com by the Solidarity Movement. The plan of the General Superintendency of Financial Entities (Sugef) is to create a separate regulation for these entities, which since 1995 have been operating without any supervision by the authorities.

"... "At some point in time, there will be supervision over that group because it is an important player in the financial system," said Javier Cascante, Superintendent of the Sugef.  In fact, Costa Rica's own solidarity sector estimates that it currently manages a total loan portfolio of $2 billion, which almost equals the volume of loans from the country's seven smallest private banks. "

Nacion.com reports that "...clusters of this type are registered in the Ministry of Labor, where there are 1,270, which represent 339,700 affiliated workers, according to figures from that source.

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