10 Countries With Lowest Interest Rates

10 Countries With Lowest Interest Rates

10 Countries With Lowest Interest Rates

Interest rates in India are at a record low currently, a factor that reduces the cost of purchase for homebuyers, who have to depend on housing finance to make the investment. With the Reserve Bank of India (RBI) bringing down the repo rate, the rate at which the banking regulator to financial institutions, to six per cent, several public and private banks lowered interest rate on home loans. If you are applying for a home loan with public lender State Bank of India, for instance, you will now have to pay 8.50 per cent.

That makes us wonder, which are the countries where repo rate is cheaper than this? 

Switzerland: This country is not just extraordinarily beautiful; it is nothing but a paradise for property owners even otherwise. Repo rate in this country stands at -0.75 per cent — this means the Switzerland government actually pays the banks to lend to borrowers.

Denmark: Back in 1992, repo rate in this Scandinavian stood at 15 per cent. The change in this regard is nothing but mind-blowing. Now, it stands at -0.65 per cent. 

Sweden: Another Nordic country that has low interest rate regime is Sweden. Key rate in this country is currently -0.25 per cent. Rates were much lower in 2016, when rates stood at -0.50 per cent. An all-time high in this country was recorded at 8.91 per cent way back in 1995. 

Japan: At -0.10 per cent, Japan’s repo rate is at record low at present. In 1973, rates touched their peak, at nine per cent.

Bulgaria: Since February 2016, there has been no interest rate in Bulgaria. An all-time high was recorded in 2008 when repo rate stood at 5.77 per cent. 

Samoa: This island country that is economically strong is an attractive proposition for many. At 0.14 per cent, repo rate is quite low but international organisations suggest that it may be difficult to operate within the regulations that the Samoan economy has set. For example, there are 21 stages to obtain construction permits and 37 tax payments to be made per year.

Israel: Political tensions notwithstanding, Israel’s key rate stands at 0.25 per cent. The highest this country has ever seen is 17 per cent in 1996. A recent report estimated that 46 per cent of the credits were for mortgages, construction, and real estate and is seen as a risk.

Fiji: Repo rate in Fiji is 0.5 per cent. An all-time high was recorded in 2010 at 2.5 per cent. Non-residents can buy a property in Fiji, but there are restrictions in buying freehold properties as well as crown residential properties.

The United Kingdom: In this old country where average rate of property is quite high, repo rate, at 0.75 per cent, is comparatively much lower. A record low was last seen in 2016 at 0.25 per cent. The average house price in the UK still stands at £455,594.

Australia: Property values have been increasing in this country, but repo rate, at 1.50 per cent, still makes buying attractive for investors. This is nothing but an achievement for the government in taming rates --- an all-time high rate regime was seen in 1990 when it stood at 17.50 per cent.

Unaffordable interest rates

Argentina (62.50 per cent), Turkey (24 per cent) Ukraine (18 per cent), Sierra Leone (16.50 per cent) and Uzbekistan (16 per cent) are among countries with absolutely high rates. 

Note: All figures have been obtained from Global Interest Rate Monitor. 

Last Updated: Thu Apr 25 2019

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