New Limits on Banking Fees and Greater Protection for Financial Customers

August 25, 2026 | Effective Date: January 4, 2027

The Board of Directors of the Superintendency of Banks of Panama (SBP) approved Agreement No. 7-2026, which amends Articles 4 and 5 of Agreement No. 4-2011, establishing new rules governing the collection of certain fees and charges applicable to deposit-taking and lending operations.

This reform represents a significant step in the SBP's regulatory policy aimed at strengthening transparency, contractual fairness, and the legal balance between banking institutions and their customers.

1. What Changes?

The Agreement introduces additional transactions for which banks may not charge commissions or fees.

Deposit-Taking Operations

As of January 4, 2027, banks may not charge:

• Fees for in-person cash withdrawals from savings or checking accounts.
• Fees for in-person cash deposits made during regular banking hours.

There is, however, an exception concerning the handling of cash in high volumes. A high volume is deemed to exist when deposits exceed B/.10,000 per month. For coin deposits, the threshold is B/.5,000 per month.

Banks may also not charge fees for:

• Designating or changing beneficiaries of savings, checking, or fixed-term deposit accounts.
• Issuing confirmation of a SWIFT message.

2. Important Changes Regarding Loans

The reform is particularly relevant to borrowers.

Banks may not charge fees for:

• Early repayment.
• Extraordinary payments.
• Transferring a residential mortgage loan to another banking institution operating in Panama,

when more than five years have elapsed from the originally agreed loan term.

Furthermore, with respect to consumer loans, agricultural loans, and residential mortgage loans subject to special preferential-interest laws, these fees may not be charged at any time.

An additional protection applies: if, during the first five years, the bank increases the nominal interest rate pursuant to contractual provisions, the customer may not be penalized with an early-repayment or loan-transfer fee.

3. Banking Documents and Services Without Fees

The Agreement also eliminates charges for certain documents that are essential to the banking relationship, including:

• Credit-status certificates or payoff letters.
• Bank reference letters.
• Payment histories requested by the customer once per year.
• Payments made in person at the banking institution.

4. A Significant Change in the Application of Payments

One of the most legally significant aspects of the reform concerns payments exceeding the agreed installment.

When a customer is current on the loan and makes a payment exceeding the amount of the periodic installment, the excess amount must be applied to the outstanding principal balance.

The bank may not use such excess amount to pay future interest or installments that have not yet become due.

This provision may have a significant economic impact because it promotes an actual reduction of the principal and, consequently, may reduce the future financing cost of the obligation.

5. Insurance Policies Related to Loans

The Agreement also establishes that a bank may not charge the customer a commission or fee merely because the customer has failed to submit the renewal of an insurance policy.

If the customer proves that the renewed policy was timely submitted and the bank nevertheless charged the fee, the institution must immediately reverse the charge.

Likewise, if the bank places the insured asset under a group insurance policy, but the customer proves that an individual policy was already in force and had been submitted to the bank, the corresponding charge must also be reversed.

6. Banks May Not Restrict Access to Information Due to Delinquency

Another important provision establishes that, even when a customer is in default, the bank may not restrict the customer's access to information concerning the delinquent loan through electronic banking services.

This strengthens the principle of transparency and ensures that borrowers retain access to the information necessary to understand and manage their financial obligations.

 

LEGAL ANALYSIS

The SBP bases the reform on the objectives established under the Banking Law, including promoting public confidence in the banking system and ensuring legal balance between the banking system and its customers.

The Superintendency also relies on its statutory authority to establish, within the administrative sphere, the interpretation and scope of banking regulations and to ensure that banks provide information that promotes greater transparency in banking transactions.

From a legal perspective, the Agreement represents a transition from a regulatory model based primarily on freedom of contract toward one in which certain practices and charges are subject to express regulatory limitations.

This has an important legal consequence: a contractual provision will not necessarily be sufficient to justify a charge when banking regulations expressly prohibit such charge.

Accordingly, banks should review their:

contracts + fee schedules + collection systems + internal procedures + digital platforms + customer communications.

 

ECONOMIC ANALYSIS

The reform will have different effects on banks and customers.

For Customers

The potentially favorable effects include:

1. Lower financing costs.
Applying extraordinary payments directly to principal may accelerate the amortization of outstanding obligations.

2. Greater banking mobility.
The elimination of certain loan-transfer fees may make it easier for customers to move their financing to another institution when better terms are available.

3. Greater competition.
The ability to change banks without certain costs may encourage institutions to compete not only through interest rates, but also through service quality.

4. Greater transparency.
Eliminating fees for certain documents and financial information reduces the cost of obtaining information necessary to make informed financial decisions.

For Banks

The impact will be primarily operational and economic.

Banks will need to review their commission-based revenue models and adjust their systems and fee schedules before the Agreement enters into force.

The elimination of certain fees could reduce non-interest income. However, it may also encourage greater operational efficiency and a more transparent pricing structure.

The real challenge will be to ensure that eliminated revenues are not indirectly replaced through other charges producing an economically equivalent effect.

 

A WARNING FOR BANKING CUSTOMERS

The Agreement does not mean that all banking fees have been eliminated.

The prohibition applies specifically to the charges and transactions addressed by the amendments to Agreement No. 4-2011.

Accordingly, customers should distinguish between:

expressly prohibited fees

vs.

fees that remain permissible under the applicable regulatory and contractual framework.

 

MOLINA & CO. RECOMMENDATION

We recommend that companies, investors, and banking customers conduct, before January 4, 2027, a review of:

1. Existing loan agreements.
2. Bank fee schedules.
3. Fees charged during the previous years.
4. Early-repayment provisions.
5. Charges associated with extraordinary payments.
6. Costs associated with loan transfers.
7. Charges related to insurance policies.
8. Procedures for applying payments toward principal.
9. Charges for payoff letters, bank references, and payment histories.
10. Charges related to deposits, withdrawals, and SWIFT transactions.

Where applicable, customers should consider seeking reimbursement or challenging charges that are incompatible with the applicable regulations, particularly with respect to transactions carried out after the new regulatory regime enters into force.

 

CONCLUSION

Agreement No. 7-2026 represents a significant change in the relationship between banking institutions and their customers.

The SBP is exercising its regulatory authority to establish specific limits on certain banking charges and to reinforce the principles of transparency, contractual fairness, competition, and banking consumer protection.

From an economic perspective, the measure may facilitate customer mobility, reduce certain financing costs, and allow for more efficient loan amortization.

From a legal perspective, the message is equally clear:

The banking relationship cannot rely exclusively on freedom of contract; it must operate within the boundaries of transparency, balance, and customer protection established by banking regulations.

The Agreement was approved on August 25, 2026, and its provisions will enter into force on January 4, 2027.

MOLINA & CO.
Legal & Business Counsel
Panama