The Central Bank of Cyprus (CBC) has set the reference interest rate at 11.5 per cent, following the authority granted under Article 314A of the Criminal Code, Cap. 154.

This new rate aims to regulate the financial sector and curb excessive charges on loans.

Under the provisions of this law, individuals or entities involved in offering loans, extending payment deadlines, or engaging in loan renewals or early repayments, are prohibited from charging interest or taking any financial benefits exceeding the reference interest rate.

The CBC explained that violating this law constitutes an offence, and if convicted, offenders face up to five years in prison, a fine of up to €30,000, or both penalties.