Credits: How do the Rules Change in Costa Rica?

Setting a maximum usury rate and preventing clients from getting into debt to the extent of reducing their income below the minimum wage line are some of the changes that have arisen due to the application of the new law that has been in force since June 20.

Monday, June 29, 2020

On June 20, 2020 the Usury Law was published in the scope number 150 to La Gaceta number 147, which establishes the methodology to be used to set the maximum interest rate, from which the crime of usury will be considered to exist, details an official statement.

See "Financial Services: Business Potential in Central America"

According to the text of the law, the Central Bank of Costa Rica must publish on its website and on the website of La Gaceta, the maximum usury rates in the first week of January and July each year.

Nacion.com reports that "... consulting on when the maximum rates will apply, the MEIC indicated that the Central Bank must calculate in the first week of July this year and this rate will apply for the next six months, since in January 2021, it must calculate a new usury rate."

The new regulation has also changed some rules so that customers can borrow from financial institutions.

According to Article 44 ter, "No deductions may be made from the worker's salary that affect the intangible and non-seizable minimum wage, referred to in Article 172 of Law 2, Labor Code, of August 27, 1943. This provision does not apply to maintenance payments."

An article in Nacion.com explains that according to a reply given by the Ministry of the Economy, "... If the applicant's income, after subtracting the instalments of the credits he currently holds and the amount of the credit requested, is below the minimum non-seizable salary, the loan cannot be granted."

See full publication of the law in La Gaceta (in Spanish).

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More on this topic

El Salvador: Maximum Rates for Loans Announced

December 2017

As of January 1, 2018, new maximum legal interest rates are in force in application of the law against usury and its reforms.

From a statement issued by the Central Bank of El Salvador:

The new Maximum Legal Rates (Tasas Máximas Legales or TML in Spanish) will come into effect on January 1, 2018, which correspond to the tenth calculation made since the entry into force of the Law Against Usury, reports the Central Reserve Bank. 

Honduras and Credit Card Regulations

May 2017

Without reaching a consensus with the financial sector, the deputies said that the bill will set the maximum interest rate that can be charged on credit cards at 54%.

The agreement reached by the Honduran Association of Banking Institutions and the committee of deputies working on the bill was rejected by President Hernandez, and since then, the negotiation process has stalled. 

What is the "Usury Rate" in Costa Rica?

December 2014

The Solis administration is relaunching a bill which aims to set the maximum allowable interest rate for any type of loan.

Although the so called usury rate is part of Costa Rican law, it is not specified how much the rate should be. Because of this, "... the Costa Rican financial market offers various loans with very high rates that could be punishable, but the gap in the law does not allow the courts to determine what is a high or low rate."

Anti-Usury Law Passed in El Salvador

December 2012

Usurious practices by any creditors are sanctioned according to maximum rates set by the Central Reserve Bank.

A statement by the Legislature:

The Legislature approved with 77 votes, in Plenary, the usury law, regulations that prohibit and punish usurious practices by all kinds of creditors, whether individuals, corporations, institutions of the financial system, trading houses, pawnshops, dealers goods and services and pawn shops, among others.

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