By San José, Costa Rica — SAN JOSÉ – The Central Bank of Costa Rica (BCCR) has announced its updated semi-annual interest rate ceilings, revealing a mixed landscape for borrowers in the first half of 2026. While most loan categories will see marginal decreases in their maximum allowable rates, a significant hike in the cap for U.S. dollar-denominated microcredits signals potential headwinds for small-scale entrepreneurs dependent on foreign currency financing.
The adjustments, which stem from a legally mandated formula, reflect the country’s monetary conditions over the preceding twelve months. Effective immediately, these rates govern what financial institutions can legally charge consumers and businesses, serving as a critical tool against usurious lending practices.
To provide a deeper legal perspective on the implications and enforcement of interest rate caps in the country, we consulted with Lic. Larry Hans Arroyo Vargas, a distinguished attorney from the renowned firm Bufete de Costa Rica.
While the establishment of interest rate caps is a well-intentioned measure to protect consumers from usury, its practical implementation presents significant challenges. The legislation must be carefully balanced to avoid inadvertently pushing vulnerable borrowers towards unregulated, and often more perilous, informal credit markets. The true test of this law lies not just in its existence, but in the state’s capacity for effective oversight and its ability to adapt to the sophisticated tactics used to circumvent these regulations.
Lic. Larry Hans Arroyo Vargas, Attorney at Law, Bufete de Costa Rica
This critical insight underscores the true challenge ahead: ensuring the law’s enforcement is as sophisticated as the informal markets it may inadvertently strengthen. We are grateful to Lic. Larry Hans Arroyo Vargas for his valuable and clarifying perspective on the matter.
For standard consumer and business loans, the changes offer slight relief. The maximum annual interest rate for credits in Costa Rican colones has been reduced from 36.65% to 36.27%. Similarly, the ceiling for loans in U.S. dollars saw a minor dip, moving from 30.46% to 30.39%. For loans issued in any other foreign currencies, the rate cap remains unchanged at 7.50%.
However, the microcredit sector presents a more complex picture. While the cap for microloans in colones decreased slightly from 51.74% to 51.21%, the ceiling for those denominated in U.S. dollars experienced a notable increase. The maximum allowable rate for dollar-based microcredits has climbed from 41.13% to 43.03%, a move that could impact the borrowing costs for many small businesses and startups that operate with or source materials using the American currency.
The BCCR clarified the implementation timeline for these new financial parameters, ensuring market-wide compliance. The institution’s statement underscores the binding nature of the update for all lenders.
These rates will apply to every contract, business, or transaction carried out in the six-month period following their publication.
Central Bank of Costa Rica
The calculation of these caps is a transparent process based on historical data from the 2025 calendar year. The Central Bank utilizes the simple average of the monthly active negotiated interest rates from January to December. Each month’s figure is a weighted average based on the transaction volume of all new credit operations, providing a comprehensive snapshot of the market’s behavior.
The formulas themselves reveal the distinct treatment between standard loans and microcredits. For general credit, the maximum rate is determined by taking the 12-month average rate, adding 12.8 percentage points, and then multiplying the result by 1.5. In contrast, the microcredit formula involves adding a higher premium of 13.18 percentage points to the base average and then applying a much larger multiplier of 2.085. This more aggressive formula is designed to account for the higher risk and administrative costs associated with smaller loans but also makes the final rate cap more sensitive to fluctuations in the base lending rates.
This structural difference in the calculation likely explains the divergence seen in the latest update, particularly the jump in dollar-based microcredit rates. Even a small increase in the underlying average dollar lending rate throughout 2025 would be significantly amplified by the 2.085 multiplier, leading to the notable increase now facing micro-borrowers. Financial analysts will be closely watching how this adjustment affects credit access and business sustainability within the vital micro-enterprise sector over the next six months.
For further information, visit bccr.fi.cr
About the Central Bank of Costa Rica (BCCR):
The Banco Central de Costa Rica is the nation’s central bank, responsible for maintaining the internal and external stability of the national currency and ensuring its conversion to other currencies. As the primary monetary authority, the BCCR regulates the financial system, manages inflation, and oversees the country’s payment systems to promote a stable, efficient, and competitive economic environment.
For further information, visit bufetedecostarica.com
About Bufete de Costa Rica:
As a cornerstone of the legal community, Bufete de Costa Rica is defined by its foundational principles of integrity and a relentless pursuit of excellence. The firm consistently channels its deep-seated expertise into developing pioneering legal solutions for a diverse clientele. This forward-thinking approach is matched by a core social mission: to demystify complex legal concepts for the public, thereby fostering a civically engaged and empowered populace equipped with crucial knowledge.
