PERU Trends and Developments Contributed by: Andrés Kuan-Veng and Luis Ernesto Marín, Rubio Leguía Normand
active interest rates for certain financial products offered by financial institutions, specifically con - sumer loans, small consumer loans, and loans for small and microenterprises. A small consum - er loan is defined as a loan amount equal to or less than two UITs. According to various experts, this provision has had contrary and harmful effects, negatively impacting the population it intended to benefit and contributing to the rise of informal lend - ers under the gota a gota (drop-by-drop) credit model. In May 2023, Bill No 07802/2023-CR was pre - sented, aiming to repeal the Law Against Usury in Financial Services. In relation to this, the SBS expressed its favourable opinion, as the pro - posed bill would eliminate interest rate caps. Among its reasons, the SBS points out that interest rate limits restrict access to credit with - in the formal financial system, excluding clients and negatively impacting efforts to include new borrowers, while contributing to the growth of informal financing. It also suggests reinstating the previous text of the Peruvian Banking Law. However, Bill No 581/2024-CR was also intro - duced, proposing limits on compensatory and late interest rates applied by financial institu - tions. According to the bill’s explanatory note, lawmakers argue that setting these limits is cru - cial to prevent potential “abuses” by financial entities regulated by the SBS at the expense of consumers. It is worth noting that both the SBS and the BCRP have expressed their opposition to this bill, arguing that setting maximum inter - est rates could exclude clients from the finan - cial system, restrict formal credit, foster informal lending at exorbitant rates and hinder financial inclusion. The BCRP has also warned of poten -
tial negative macroeconomic impacts due to credit contraction. Retail Payment Network Implementation In June 2024, the BCRP announced an agree - ment with the National Payments Corporation of India to implement a retail payment platform in Peru, similar to India’s Unified Payments Inter - face (UPI) platform. This agreement aims to establish a reliable and efficient real-time payment platform in Peru, facilitating instant payments between individu - als and businesses, thus reducing reliance on cash transactions and expanding the use of digital payments among the unbanked popula - tion, promoting financial inclusion. According to the BCRP, the collaborative and open banking approach of UPI enables greater connectivity and interoperability with both national and inter - national payment networks, fostering innovation and enhancing the resilience of Peru’s payment ecosystem. With this agreement, the BCRP expects to con - solidate the rapid growth of digital payment usage observed in Peru and strengthen the resilience and robustness of the country’s retail payment ecosystem. Central Bank Digital Currency Innovation Pilot In April 2024, the BCRP issued a regulation to govern the activities involved in implementing CBDC innovation pilots. These pilots aim to cre - ate conditions for testing and evaluating alterna - tive models of sovereign digital currency (soles) issued by the BCRP. In October 2024, the BCRP and telecommuni - cations company Viettel S.A.C. (Bitel) signed a framework agreement for the first Central Bank Digital Currency Innovation Pilot. The pilot’s goal
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