Guatemala: Call to Veto Credit Card Law

Issuers have objected in particular to the cap on interest that can be charged, citing an increased credit risk and a reduction in the number of cardholders.

Monday, November 16, 2015

An article on Lahora.gt reports that "... Roberto Fuentes, of the Association of Credit Card Issuers of Guatemala (AEMPG), said the Credit Card Act does not have the technical basis necessary to actually have a positive effect on users. Fuentes explained, if a maximum rate of 26 percent annual interest is imposed, the risk of loss to businesses increases, therefore those who earn less than 12,000 quetzales would no longer qualify for a credit card . "

Another unintended consequence of the enactment of the new law is that "...it will have an impact on the collection of taxes, and that will affect consumption levels."

Currently "... interest rates are around 44 percent."

"... The Executive has not yet given the green light to the Act, but representatives of issuers, have already announced that, if enacted, they will file an action against this law, and at the same time have appealed to President Alejandro Maldonado to veto the legislation which was recently approved. "



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