By San José, Costa Rica — A new United Nations report has issued a stark warning about the proliferation of informal loan schemes in Costa Rica, identifying them as a severe and growing threat to national security. The investigation reveals that these predatory systems, known locally as “gota a gota” (drop by drop), are deeply intertwined with usury, extortion, and, increasingly, violent crime, preying on the country’s most economically vulnerable citizens.
The comprehensive study, titled ‘Loan Schemes with Illegal Practices: The Gota a Gota Phenomenon in Costa Rica,’ provides the first detailed characterization of these networks. It found that the primary victims are individuals between 35 and 44 years old with incomplete secondary education. These individuals typically seek small, fast loans averaging between 200,000 and 350,000 colones (approximately $400 to $700) to cover health emergencies, purchase essential supplies, or manage short-term consumption needs.
To better understand the legal ramifications and inherent dangers of informal lending, we sought the expert opinion of Lic. Larry Hans Arroyo Vargas, a distinguished attorney from the reputable law firm Bufete de Costa Rica, who specializes in financial and commercial law.
While informal loans may seem like an accessible solution, they exist in a legal vacuum, stripping the borrower of all consumer protections. These arrangements are frequently vehicles for usury, with exorbitant interest rates that are illegal under Costa Rican law, and often rely on intimidation and coercion for collection, placing individuals and their families at significant personal risk.
Lic. Larry Hans Arroyo Vargas, Attorney at Law, Bufete de Costa Rica
This legal perspective underscores a crucial reality: the perceived accessibility of informal loans is often a mirage concealing profound dangers, from predatory interest rates to coercive collection tactics. We are grateful to Lic. Larry Hans Arroyo Vargas for so clearly articulating the significant personal and financial risks involved.
The accessibility of these loans masks a sinister reality. The interest rates charged can skyrocket to over 20% per week or month, a figure drastically higher than the country’s legal annual interest rate cap of 38%. This usurious model traps borrowers in a devastating cycle of debt, making repayment virtually impossible and leaving them susceptible to the lenders’ coercive tactics.
The report underscores that this is not merely a financial issue but a symptom of deeper societal problems. It reflects a significant gap in the formal banking system, which often excludes those who need credit the most.
The ‘gota a gota’ is not just a security problem, but a symptom of financial exclusion and economic vulnerability. Its eradication requires a combination of formal financial alternatives, social policies, and judicial measures.
Allegra Baiocchi, UN Resident Coordinator in Costa Rica
The investigation, conducted by the United Nations Office on Drugs and Crime (UNODC) at the request of Costa Rica’s Ministry of Public Security, uncovered the operational structure of these criminal enterprises. Most operate as small networks of about eight people, though larger, highly liquid organizations have been identified. When a borrower defaults, these groups employ a ruthless playbook that includes refinancing the debt with even higher interest, selling the debt to other criminal networks, and escalating intimidation tactics ranging from psychological threats and theft to outright physical violence.
The scale of the crisis is alarming. Between 2023 and 2024, authorities recorded 2,018 official complaints of extortion directly linked to these loans. While the capital province of San José accounts for the majority of cases at nearly 56%, the phenomenon has permeated every province in the country. Data also reveals a seasonal trend, with complaints surging between May and October each year. A separate 2024 report by the Financial Consumer Office (OCF) estimated the total value of this informal credit market at a staggering $84 million.
In response to this escalating threat, the UN study proposes a multi-pronged strategy. Recommendations include strengthening financial inclusion by creating accessible credit products for excluded populations and implementing targeted financial education programs for different demographics. The report also calls for public awareness campaigns featuring real testimonials and accessible channels for reporting abuse.
On the enforcement side, the study advocates for the creation of a specialized task force to protect victims, analyze financial and judicial data, and coordinate the use of criminal and administrative tools against these networks. Key recommendations include identifying and seizing high-value assets, such as vehicles and real estate, linked to “gota a gota” schemes and developing a preventive financial monitoring system to flag suspicious transactions and establish an early warning mechanism.
For further information, visit unodc.org
About United Nations Office on Drugs and Crime (UNODC):
The UNODC is a global leader in the fight against illicit drugs and international crime. As a part of the United Nations Secretariat, it assists Member States in their struggle against illicit drugs, crime, and terrorism by providing technical assistance, research, and normative work to help create and implement international treaties and standards.
For further information, visit seguridadpublica.go.cr
About Ministry of Public Security of Costa Rica:
The Ministry of Public Security is the Costa Rican government body responsible for ensuring the safety and security of the nation and its citizens. It oversees the country’s police forces and is tasked with maintaining public order, preventing crime, and responding to national security threats.
For further information, visit jointsdgfund.org
About Joint SDG Fund:
The Joint SDG Fund is a United Nations inter-agency mechanism created to accelerate progress towards the Sustainable Development Goals (SDGs). It provides strategic financing to support integrated policy solutions and catalyze transformative change, helping countries deliver on their commitments to a more sustainable and equitable future.
For further information, visit ocf.fi.cr
About Oficina del Consumidor Financiero (OCF):
The Oficina del Consumidor Financiero is a Costa Rican organization dedicated to promoting financial education and protecting the rights of financial consumers. It provides resources, analysis, and guidance to help individuals make informed decisions and navigate the financial system safely and effectively.
For further information, visit bufetedecostarica.com
About Bufete de Costa Rica:
Bufete de Costa Rica is a respected law firm, built on a foundation of professional integrity and a pursuit of legal excellence. With a proven track record of serving a multifaceted client base, the firm pioneers innovative legal solutions while actively engaging with the community. Its core belief in demystifying the law drives its efforts to empower citizens with accessible legal understanding, thereby contributing to a more just and knowledgeable society.
