BCRA introduces new default interest rate for courts
The Central Bank of Argentina (BCRA) has approved the publication of the Default Interest Rate (TIM), a new statistical series. This tool will assist courts in determining interest on late peso debts under the Civil and Commercial Code.
Calculating the new default rate
The Default Interest Rate (TIM) is calculated as an average of passive and active interest rates.
The passive rate corresponds to 30-day peso time deposits, while the active rate is derived from the weighted average of rates on peso loans granted through single-signature documents and personal loans.
The daily interest rate for TIM calculation operates within specific bands to safeguard debt value and ensure reasonableness.
It cannot exceed the daily variation of the Reference Stabilization Coefficient (CER) plus a 3% effective annual rate, nor can it fall below the daily variation of the CER minus a 3% effective annual rate.
This mechanism aims to provide a balanced and predictable framework for debt interest determination.
Accessing the TIM calculator and data
Users can access the new TIM Calculator in the BCRA's Services and Procedures section, enabling them to estimate interest and total amounts for specific periods and initial sums.
The corresponding resolution, along with its methodological annex, will also be published on the portal.
Furthermore, the historical series of the Default Interest Rate will be made available in the Statistics and Indicators section, updated daily and provided in Excel format.
This initiative underscores the BCRA's commitment to regulatory transparency and administrative simplification, ensuring easy access to crucial financial data.
Strengthening legal certainty
This new rate is a welcome step towards greater predictability in debt settlements, addressing a long-standing need for a clear judicial tool.
Its real-world impact will depend on consistent judicial application and broad public understanding, which remains a key challenge.
The BCRA's commitment to transparency is commendable, but effective implementation requires more than just publication.