Costa Rica’s currency and banking system

Costa Rica’s official monetary currency is the colon (singular) and colones (plural). As of 2008, the current exchange rate is one U.S. dollar is equal to 518 colones. Here’s a useful travel tip for you. If you are in Costa Rica, shop at establishments that price their products in colones. This is due to the fact that you will be getting your money’s worth. Exchange your U.S dollars to the local currency and shop around like a local Costa Rican.

Also visit restaurants and other establishments that charge in colones. There’s a tendency for establishments that price their product in U.S. dollars to increase the rate and you might not be getting your money’s worth. The pricing is much higher if it was set in dollars, maybe as a strategy to earn more profit from tourists.

Costa Rica Banking operations

There are two types of banks in Costa Rica. These are National (or State) and Private Banks. National banks are similar to the system being implemented in the United States through its Federal Deposit Insurance Corp. (FDIC). In some ways, the deposits made by the clients are very well insured. Private banks are those run by private companies and not by the government.

When it comes to offshore banking, the Costa Rican government makes sure that no illegal activities take place. When people hear of this term, they immediately think that it has something to do with evading taxes and transferring funds from illegal activities. However, banks in Costa Rica follow the international laws in terms of banking privacy. This assures that the clients are protected in terms of security of its information and funds. 

The financial sector of Costa Rica includes commercial banks (3 state owned and 19 commercial), one workers’ bank, one state-run mortgage bank, four mutual home-building companies, fifteen private finance companies, 27 loans and savings cooperatives and of course, the Central Bank. 

There’s a lingering question that’s probably on your mind right now. How secure is your money in state-run banks? The answer: Completely secure.

Costa Rica’s Central Bank is the regulatory agency in terms of the country’s banking policies.

You must know that private banks don’t offer deposit insurance. However, this is not the case for the state-run banks. There was an incident in 1995 wherein a state-run bank was closed due to millions in losses and emergence of questionable investments. Several high ranking officials of the bank were arrested and jailed. Meanwhile, the depositors got their money back since it was insured.

This leads to the question, is your money is safe in private banks? And the answer is yes, it is safe, although the risk of not getting your deposit back in full should unfortunate circumstances happen may be higher. These private banks have been in existence for just about 13 years in Costa Rica. Until recently, there was ongoing collaboration between private banks and the Central Bank in terms of protecting the deposits of each customer. In recent years, there had been merging of private banks since the demand is not that heavy in terms of private banking. The local residents have already gotten used to depositing their funds in state-run banks. 

Costa Rica Online banking

Online banking has been in existence in Costa Rica for the past few years. It gained popularity with most people since it offers convenience and fast transactions as compared to enduring long queues in banks and in paying utility bills. 

With the emergence of the internet, residents can now check their accounts on the computer. They can transfer funds to other accounts based in the same bank, transfer of funds in other banks, update account balances, pay utility bills and a lot more. The possibilities are endless.

Opening an bank account in Costa Rica

Getting a savings and/or checking account may be tricky since there are restrictions that are imposed. However, the process varies in different banks, do some research and ask for local recommendations.

Automated teller machines (ATMs)

Automated teller machines are available in a number of areas in the city and beach towns. 

Learn the local language

It will be advantageous on your end to learn the first language of Costa Ricans which is Spanish. If you are planning to stay here for a long time, it pays off to learn the commonly used language. You may need to adjust when you go to banks because most tellers only speak in Spanish or most of the bank’s Web sites are in Spanish.

 Costa Rica's economic development - 10.02.2012 10:38