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Costa Rica May Follow US On Credit Card Interest Limits

Following the lead of US president, Barack Obama, that signed into law limits on credit card fees and curbs contract changes, the Oficina de Apoyo al Consumidor in Costa Rica announced yesterday that a similar law could be a reality in Costa Rica.

Cynthia Zapata, director of the Oficina de Apoyo al Consumidor, said that they will also try to place limits on credit card rates and other markets, that are not in place now.

“We have a dispersion in the fees,” said Zapata.

For his part, José Ignacio Cordero, general manager of Credomatic, said that many of the regulations approved in the US are already applied in Costa Rica.

Zapata said that because there is no limit on the interest charges usury laws do not apply in Costa Rica and consumers suffer,

Interest rates on credit cards in Costa Rica can be over 50% per year. The state bank, Banco de Costa Rica (BCR), for instance, publishes it has one of the lowest credit card interest rates, 27% for domestic, 25% for international, gold, platinum and business.

Credomatic, which issues Visa, Mastercard and American Express credit cards, charges between 2.5% to 4.13% monthly on its products.

The BCR and Credomatic publish their rates on their internet websites, while most of the other banks, state and public, do not, like the Banco Popular, which claims it has one of the lowest credit card interest rates in the market, but does not publish such.

The objective of the Oficina de Apoyo al Consumidor to set norms and standards for credit cards, for consumers to be well informed and for credit card issuers not to gouge the consumer.