QCOSTARICA — Eight financial entities in Costa Rica announced Tuesday a plan to combat loansharking or extortionate (in Spanish “gota a gota”) lending.
The plan also includes an education campaign to alert and raise awareness about the risks associated with high-interest informal lending, where interest rates are much higher than those of the formal system and the conditions are whimsical since the ultimate goal of the loanshark is to prevent the indebted person from being able to get out of debt.
According to Mario Zamora, the Minister of Public Security, loansharks are capable of using violence, such as beatings, kidnapping, and death threats to extort payments.
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The state banks, Banco Popular (BP), Banco Nacional (BN), and Banco de Costa Rica (BCR), along with the private bank BAC Credomatic and financial entities Coocique, Coope Ande, Coopenae, and Coopealianza, are participating in the strategy.
This is what each has to offer consumers to avoid falling victim to informal lenders or loansharking, which can charge up 8% interest daily on small loans.
Banco Popular (BP) is offering the “Prestamito Popular” initiative, an easily accessible small loan option (microcrédito) for salaried, pensioners and people with income from the informal sector. The loans range between ¢100,000 and ¢650,000. The financing request is made through the form available on the website https://www.bancopopular.fi.cr, for an immediate and expeditious analysis. In addition, the bank offers a toll-free telephone line (800-8266692) to answer questions.
Banco Nacional (BN) has a product called “BN Soluciones Microcrédito Ampliado” – BN Soluciones Small Loan Expanded”, which consists of secure financing that adjusts to the needs of each client of vulnerable populations.
Banco de Costa Rica (BCR) has the “Salvatanda” product, a financial option that people can turn to to satisfy an unforeseen need. Customers can request the product through BCR Directo, which is the BCR’s electronic form for product requests. Once the request for loans of up to ¢650,000 is made, the bank is in charge of contacting the client to manage the request in a self-managed manner.
BAC Credomatic presented “BAC te Cubre” (BAC has your back), for low amounts if the client does not have money in their account, with a limit of US$120, as well as “microcréditos”, immediate loans for long-term low-amount needs for an amount of up to ¢650,000 and includes a debit balance policy.
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Coopenae announced that it will make available a new line of financing called “Finanzas Sanas” (healthy finances) with a term of up to 36 months. Each case will be analyzed in a personalized, at no charge.
Coope Ande ffers its new financial product “Bienestar Uno a Uno” (One to One Wellbeing), a solution designed to promote financial inclusion. This product facilitates access to personalized and secure financing.
Coocique presented the “Credimpulso” plan to support microbusiness owners who need financing for working capital, investing in assets or paying off liabilities.
CoopeAlianza will continue with its well-designed financing program to support active associates with limited access to financing. It did not provide details.
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The plans announced today have the following axes:
- Financial products. Each participating entity developed a new product or adapted an existing one, in order to allow greater inclusion of vulnerable populations.
- Enabling guaranteed funds to partially support these loans and thus improve the risk profile of debtors.
- Proposal for regulatory adjustment to make some parameters of the rules that apply to financial institutions more flexible and, in this way, offer better conditions to clients.
- Awareness campaign for the general population to warn about the risks of informal extortion financing and promote reporting in the case of those who already face this problem.
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