Central Bank of Cyprus sets new reference interest rate to combat usury

On October 30, 2026, the Central Bank of Cyprus announced that it has set the official reference interest rate at 11.60%. This measure is enforced under Article 314A of the Penal Code (Cap. 154), aimed at regulating lending practices and preventing usury.

The legislation stipulates that any person or entity who charges, collects, or agrees to receive economic benefits exceeding this 11.60% limit in relation to loans—including the extension of payment deadlines, loan renewals, or early repayments—commits a criminal offense. Violators face severe legal consequences, including imprisonment for up to five years, a monetary fine of up to €30,000, or both.

This decision serves as a formal warning to the public and financial actors regarding the legal boundaries for interest-bearing transactions. The Central Bank of Cyprus exercises its statutory powers to ensure market compliance with these provisions, emphasizing that any financial gain obtained beyond the set ceiling will be prosecuted as a criminal act under the national penal framework.