Opposition proposes interest rate cap to combat usury

Tuesday, August 23, 2011

Peru's opposition politicians have presented a bill to congress that would set a cap on interest rates charged by the country's financial institutions.

Under the proposal tabled by the centrist block Alianza Parlamentaria, central bank BCRP would determine the maximum rates that can be charged for each type of financial transaction.

The proposal aims to reduce predatory lending practices, as well as strengthen Peru's financial stability.

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The political block that presented the bill represents only 10% of the Peru's congress, and the proposal so far has had no noticeable effect on the markets.