By the first half of 2021 all maximum annual interest rates that are estimated by the Central Bank will decrease compared to those imposed in the second half of 2020.
On January 8, 2021 the Central Bank of Costa Rica (BCCR) published, on its website and in the official newspaper La Gaceta, the new maximum annual interest rates for credit operations in colones, US dollars and other currencies.
The Costa Rican government is facing a complex scenario, since by not achieving consensus to access international loans, it will be forced to seek domestic funding sources, which would put pressure on the exchange rate and interest rates to rise.
Preventive reasons for unforeseen expenses in the context of the pandemic and low liable interest rates are some of the factors that explain the increase in the balance of short-term savings instruments in the Costa Rican market.
In the context of the spread of covid-19 and the restriction of several productive activities, the broad money supply (including cash held by the public and highly liquid financial instruments in national and foreign currency) showed a 35.7% year-on-year growth rate in June 2020, considerably higher than the 2.7% recorded in the same month in 2019, while the balance of term instruments fell, reported the Central Bank of Costa Rica (BCCR).
Following the entry into force of the Usury Law, the Central Bank published the maximum annual interest rates, which for credit operations in colons amount to 37.69% and 30.36% in dollars.
The law that was published on June 20, 2020 establishes the methodology to be used to set the maximum interest rate, and stipulates that the Central Bank of Costa Rica must publish on its website and on The Gazette, the maximum usury rates in the first week of January and July each year.
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.
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.
This week, the Basic Passive Rate continued to fall, from 3.8% to 3.75%, while the Effective Rate in dollars also fell, from 1.94% to 1.84%.
The Central Bank of Costa Rica published on the afternoon of Wednesday, April 15 that after registering considerable drops in the previous weeks, the Basic Passive Rate fell again, in this case by 0.05% and will remain at 3.75% until next Wednesday, April 23.
This week, the Basic Passive Rate continued to fall, from 4.35% to 4.15%, while the Effective Rate in dollars also fell, from 2.35% to 2.25%.
The Central Bank of Costa Rica published on the afternoon of Wednesday, March 25 that after registering considerable drops in the previous weeks, the Basic Passive Rate fell again, in this case by 0.20% and will remain at 4.15% until next Wednesday, April 1.
The Basic Passive Rate continued to decline and for this week fell from 4.50% to 4.35%, while the Effective Dollar Rate also fell from 2.35% to 2.25%.
The Central Bank of Costa Rica published on the afternoon of Wednesday, March 18th that after registering considerable drops in the previous weeks, the Basic Passive Rate fell again, in this case by 0.15% and will remain at 4.35% until next Wednesday, March 18th.
In order to help cooperatives, cope with the emergency caused by the spread of covid-19, the National Institute for Cooperative Development agreed to reduce the interest rate on loans.
This decision was taken to support the cooperative sector, especially the agricultural sector, which has been suffering from a variety of effects. The authorities also hope to make a significant contribution to the country, in the context of the current epidemiological situation, reported the National Institute for Cooperative Development (INFOCOOP).
The Basic Passive Rate remained at 4.5%, while the Effective Dollar Rate reported a decrease, in this case from 2.38% to 2.35%.
The Central Bank of Costa Rica published on Wednesday afternoon, March 11, that after registering a decrease the previous week, the Basic Liable Rate reported no variations for the next few days and will remain at 4.5% until March 18.
The Basic Passive Rate continued to decline and for this week fell from 4.80% to 4.50%, while the Effective Dollar Rate also fell from 2.45% to 2.38%.
The Central Bank of Costa Rica published on Wednesday afternoon, March 4 that after registering considerable drops in the previous weeks, the Basic Passive Rate fell again, in this case by 0.30% and will remain at 4.50% until next Wednesday, March 11.
For the Central Bank of Costa Rica, the constant reductions in the Monetary Policy Rate that have taken place since March 2019 have been gradually and incompletely transferred to the interest rates of the financial system.
The Basic Passive Rate dropped from 5.65% to 4.95%, while the Effective Dollar Rate also dropped, from 2.41% to 2.35%.
The Central Bank of Costa Rica published on the afternoon of Wednesday, February 19 that after registering a slight fall the previous week, the Basic Passive Rate fell again, in this case by 0.70% and will remain at 4.95% until next Wednesday, December 26.
In Costa Rica, the Effective Rate in Dollars registered an increase from 2.47% to 2.49%, and the Basic Passive Rate remained at 5.75%.
The Central Bank of Costa Rica published on Wednesday afternoon, February 5th, that for this week the Basic Passive Rate will remain unchanged for the fourth consecutive week, and will be at 5.75% until next Wednesday, February 12th.
Arguing that in 2020 and 2021 inflation is expected to remain within the target range, although below its average value of 3%, the Central Bank reduced the monetary policy rate from 2.75% to 2.25%.
Over the next two years, the central bank's monetary policy will continue to be aimed at keeping inflation low and stable and supporting economic activity, in line with the counter-cyclical stance it adopted from March 2019, reported the Central Bank of Costa Rica (BCCR).
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