(CMR) The CICSA Co-operative Credit Union Ltd. has announced that it is increasing its interest rates beginning in October. The rate increase brings it in line with traditional commercial bank interest rates elsewhere in the Cayman Islands.
The Credit Union does not adjust interest rates in line with the US Federal Reserve rate changes; however, a decision was taken on 3 August 2023 to increase the loan interest rate by 0.25%, which will bring the rate to what they were before the COVID-19 pandemic, 6.75%.
The rate increase of 0.25% for members with existing loans will be deferred until 1 October 2023 to help members plan for the increase, the Credit Union stated.
Although interest rates on loans in the market have increased by 5% since March 2022, bringing the Cayman Islands Prime Interest Rate used by commercial banks to 8.5%, CICSA said its loan interest rate has been no higher than 6.75% since 2010.
Due to the change in economic conditions caused by the COVID-19 pandemic in 2020, the Credit Union said it made the decision to reduce its rate of 6.75% by 1% to 5.75% to help offset any negative impacts on members.
A decision was taken on 28 July 2022 to increase interest rates by 0.75% in October 2022, which increased the rate to 6.5%. This was the last increase made before this one.