(QCOSTARICA) On Tuesday, President Carlos Alvarado signed into law the usury law that sets a maximum interest rate of 39% loans in colones and 31.5% in dollars for loans of ¢675,000 colones and higher.
For loans of less than ¢675,000, classified as microcredit, the rate limit would be 55% in colones and 45.66% in dollars.
Interests that exceed those limits would be considered usury, that is sanction from six months to two years in prison.
“For many years there has been concern about the high-interest rates that people in Costa Rica pay for their consumption on credit cards and others,” said Alvarado.
“This law manages to put a stop to high-interest rates to alleviate the pocket of Costa Rican households and alleviate the overindebtedness that exists in the country. This was a campaign promise that I am very satisfied to fulfill,” said the president
The new law will take effect starting July 2020, and it is not retroactive, that is, it will only benefit those who acquire their credits after the law comes into force.
For the Minister of the Economy, Victoria Hernández Mora, “this lawn is a valuable opportunity to provide the population and companies with more information when it comes to establishing and evaluating financial products, allowing them fairer and more balanced relationships in their credit operations.”