For six-month term savings in colones, the Central Bank in Costa Rica is offering a return of 8.10%, a rate that is higher than that available at commercial banks.
In order to attract money from savers in colones in six months terms, the rates currently offered by financial institutions are 8.10% in the case of the Central Bank (Banco Central), 6.85% at Banco Nacional, 6.75% at Banco de Costa Rica and 6.40% in Promérica.
With the disappearance of the differential between the interest generated on the two currencies, the choice between one or the other for using for savings is being defined by the risk of devaluation of the colon against the dollar.
An article in Elfinancierocr.com reports how the fall of the passive base rate during 2016 decreased the gap between interest rates paid on deposits in both currencies, concluding that "...If the trend continues, for savers it will be the same keeping their money in colones or in dollars and they may prefer the currency in light of the possibility of rates rising overseas."
In response to the severe water supply crisis in Costa Ricatax exemptions have been proposed for the purchase of materials, equipment and devices for saving water.
The state run Aqueducts and Sewers company (AyA) is preparing a bill to exempt three taxes on buying water saving devices such as low consumption tanks, water saving devices for pools or drinking fountains, ejector aerators, filters, faucet timers, volumetric reductors, and low consumption irrigation systems, among other things.
45% of Costa Ricans prefer to pay with cash than use debit cards, despite the fact that nearly 8 out of 10 possess this means of payment.
According to the latest study by the World Bank (WB), 53.6% of people over 15 years old in Costa Rica have at least one debit card, placing the country in fourth place in Latin America, just behind Brazil , Puerto Rico and Chile.
During the last twelve months the returns given by state banks to their clients for savings in colones rather than dollars decreased by 2.6 % .
A financial report by the Central Bank of Costa Rica (BCCR) explains that "the data shows that the average differential in savings with a term of six months, closed at 1.46 points in September. But that margin was four points in the same period of 2012 ... ", reported Nacion.com.
Private banks in Costa Rica are opposed to the $30 million fund that protects small depositors being transferred to the Central Bank.
Nacion.com reports that "private banks are against transfer of the administration of the $30 million fund which protects small savers, in case of bankruptcy of a financial institution, to the Central Bank, as ordered by a Bill ruled on in the Economic Affairs Committee of Congress. "
From October last year to date, public banks in Costa Rica cut their average rate by almost 4.5%.
"In the last four months state banks made a sharp rate cut to place them below the average of other intermediaries and brush with near-zero real returns", reported Nacion.com.
Costa Rica still faces obstacles to implement this mechanism, regarded as the best alternative for funding public works.
Public works securitization is once again being discussed, as the upcoming Tourism Minister stated it will be used to fund a new National Conventions Center.
Now is not the time to be spending, it is time to save; however, variations in interest rates and inflation make it difficult to decide whether to save on a short or long term plan.
Andrés Volio, a finance expert, and Alberto Franco y Roberto Venegas, both economists, give suggestions on this topic in an article published by Edgar Delgado on Elfinancierocr.com
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O4Bi is a system that allows to control and manage what a company needs: the complete process of development of works, accounts receivable, treasury, banks, sales and accounting.
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