Are you receiving the interest that you deserve ?
In today's financial environment, interest paid on savings accounts are at a dismal level. Trying to live in retirement, on the interest on your saving, was once a viable strategy. However, interest rates on savings, in most banks, are so low today that they produce minimal income. Panamanian credit unions are an appealing alternative for foreigners seeking a safe fixed income. Credit unions offer highly competitive interest rates on savings in Certificates of Deposit and Money Market Accounts. Many people have experienced the extensive and exhaustive documentation requirements and long delays when attempting to open accounts in Panama banks. Credit unions are more user friendly and especially attractive to retirees who are seeking a safe fixed income investment. Credit Unions have existed in Panama for the past 70 years and just like in the U.S., they operate as cooperatives for savings and credit for the member employees of various industries and government agencies. In other words, a "Cooperativa" is a Panamanian credit union that is a licensed and government-registered. These cooperative financial institutions are regulated by Law 17 of May 1997, which gives them tax free status, among various other benefits. Panamanian credit unions are regulated by the "Instituto Panameño Autonomo Cooperativo" (IPACOOP), whose website is www.ipacoop.gob.pa.
There are over 150 credit unions in Panama, some of them over 50 years old. The larger credit unions have as many as 100,000 members, and each member pays a monthly minimum deposit towards the credit union capital, generally from $5 to $10.
Since credit unions are tax free, non-profit organizations, all profits are paid back in the form of interest to depositors. This allows Credit unions to pay higher interest rates to their depositors than do banks.
According to some professionals in the industry, credit unions are considered to be more secure and less risky than banks for several reasons. One reason is that credit unions are limited to lending up to a maximum of four times the amount of their capital, while banks can lend up to ten times their capital. This means credit unions have less exposure to lower economic cycles or high debt obligations.
A second reason is that credit unions are regulated in the type of loans that the offer. They are limited to loans within the parameters of their intended purposes, typically for consumer items. The majority of loans are under $10,000, and they usually require direct debit payments from the member borrowers’ salary via payroll deduction. In addition, collateral guarantees and multiple loan co-signers are required. Banks are generally more exposed to economic cycles, due to large high-risk commercial loans, international currency movements and global interest rate changes (LIBOR, etc.). These variables have bankrupted many banks around the globe in the recent global economic crisis. There has never been a credit union failure in Panama. A few Panamanian banks have failed, although not in recent years.
Offshore CD Network Inc. represents a major Panama Credit Union that offers Certificates of Deposits with interest rates ranging from 4.5% to 8.5%.
If you are seeking a better return on your saving, Panama credit unions may be your answer. For information please contact: lee@offshorecdnetwork.com
Get the interest that you deserve !
