The Central Bank of Cyprus (CBC) has set the reference interest rate at 11.32 per cent under Article 314A of the Criminal Code Law (Cap. 154).

The central bank said the reference rate was calculated in accordance with the powers granted to it under the relevant legislation.

It explained that the rate serves as the legal threshold used to determine whether a lending transaction constitutes the criminal offence of usury.

Under the provisions of Article 314A, any person who, when granting a loan, extending or granting additional time for repayment, renewing a loan or discounting a loan, receives, collects, charges or agrees to obtain a financial or property benefit exceeding the reference interest rate commits a criminal offence.

The legislation provides that anyone convicted of the offence may face up to five years’ imprisonment, a fine of up to €30,000, or both penalties.