Credit card interest in Brazil rose for the fifth straight month, standing at 13.79% in May. The 0.8% increase applied to the rate last month is the highest since June 2018. The rate reaches 371.25% per year, according to data from the National Association of Finance, Administration and Accounting Executives (ANEFAC ).
The increase also occurred with the overdraft, which had annual interest of 150.14%, registered in the last month. ANEFAC warns of an even more pessimistic scenario in the coming months.
The researchers responsible for the study predict the maintenance of high costs for short-term credit in the face of a higher risk economic situation, combined with the increase in the number of defaulters and the Selic rate.
For the association’s executive director of Economic Studies and Research, Miguel José Ribeiro de Oliveira, care must be taken not to acquire debts at this time. “High inflation corrupting household income, high interest rates making credit difficult and making credit more expensive, more selective banks and extremely high unemployment.
In this scenario, caution is the best of paths. Consumers should avoid getting into debt, especially in credit lines with very long terms, as well as those where interest rates are much higher”, he warns.
Oliveira also highlights the importance of making good use of this form of payment. “The credit card is the most expensive line of credit we have in the country. Interest rates are passing 300% per year. So, currently, it is a good instrument for those who know how to use it. Buy with the certainty that, at maturity, they will pay”, he explains, adding: “what you can’t do is roll the debt on the card, paying the minimum amount of the invoice”.
The economist at the São Paulo School of Economics at Fundação Getúlio Vargas (EESP-FGV), Alberto Ajzental, explains that these increases in credit card rates are influenced by the performance of the Selic, the economy’s basic interest rate.
“It is the basis for all interest rates on credit vehicles. It was at 2% in February 2021. Now, in June, it is at 13.25%. So, in this period, it rose 11.25%. Following the Selic, therefore, there is an increase in all rates”, he ponders.
Source: CNN Brasil
