Municipal savings banks will offer credit cards with rates from 24%

The approval by insistence of the law that will allow municipal savings banks to offer credit cards without the express authorization of the Superintendency of Banking and Insurance (SBS) will make loans available to more than two million Peruvians with interest rates of between 24% and 32%

In total, the opinion approved in Congress authorizes the edile boxes to administer and manage up to four products: credit cards, checking accounts, cashier’s checks and draft orders.

For the Peruvian Federation of Municipal Savings and Credit Banks (Fepcmac), having a diversified issue of plastic will level the ground on a market dominated by banks, whose rates today exceed 80% interest, one of the highest in America Latina.

To issue their own cards, microfinance institutions will have to meet two requirements: have assets of more than 75,000 UIT (S/345 million) and have been in operation for more than three years.

Of the twelve municipal savings banks that operate today, nine meet the profile.

“We have a credit risk management that has allowed us to maintain, despite having the most sensitive sector of the economy -micro and small entrepreneurs-, an average delinquency that barely exceeds 5%,” says Jorge Solís, president of the Fepcmac.

Solís points out that they will not operate outside the supervision of the SBS, but that the latter will have a key role in regulating the law, which must be known within 60 days of its publication.

More weapons for the boxes

The new law invests savings banks with checking accounts, a product that banks have been managing for 40 years, and which has given them a substantial “advantage”, since they are the source of up to 30% of the funding they manage, but with zero interest .

They may also incorporate multilateral organizations as partners or strategic allies, which, in the opinion of Fepcmac, will strengthen the presence of microfinance institutions through a classification of international standards.