Credit card revolving interest hits 409.3% per year in 2022

Even after the end of the cycle of raising the basic interest rate, the Selic, the total average interest charged by banks on credit card revolving credit cards rose 13.9 percentage points from November to December, the Central Bank informed this Friday ( 27). The rate went from 395.4% (revised data) to 409.3% per annum. At the end of 2021, it was 347.4% – a jump of 61.9 percentage points in the year.

The revolving credit card, together with the overdraft, is an emergency credit modality, much accessed in times of difficulty.

In the case of installments, still using a credit card, interest increased from 180.0% (revised data) to 182.4% per annum. Considering the total interest on the credit card, which takes into account revolving and installment operations, the rate increased from 100.5% (revised data) to 94.1%. In December of the previous year, the rates were 168.4% and 63.6%.

In April 2017, the rule that obliges banks to transfer, after one month, the debt from the revolving credit card to the installment plan, at lower interest rates, began to apply. The government’s intention with the new rule was to allow the interest rate for the revolving credit card to retreat, since the risk of default, in theory, drops with the migration to the installment plan.

On free credit, the average interest rate stopped rising: it dropped from 43.5% per annum in November to 42.0% per annum in December. In December 2021, it was 33.8%.

For individuals, the average interest rate on free credit increased from 57.9% to 55.8% per year from November to December, while for legal entities it went from 23.3% to 23.1%. Rates were 45% and 19.7%, respectively, at the end of 2021.

Among the main free credit lines for individuals, special checks stand out, whose rate increased from 133.5% per year to 131.9% per year from November to December In personal credit, the rate increased from 42.0 % to 40.9% per annum. In December of the previous year, the rates were 127.9% and 37.6%, in that order.

Since 2018, banks have been offering an installment plan for overdraft debts. The option applies to debts greater than R$ 200. In January 2020, the BC began to apply a limitation on overdraft interest at 8% per month (151.82% per year).

Data released this Friday by the Central Bank also showed that, for the acquisition of vehicles, interest rates went from 27.7% per annum in November to 28.7% in December. At the end of 2021, it was 26.8%.

The average interest rate on total credit, which includes free and earmarked operations (with savings and BNDES resources), went from 31.0% per year in November to 29.9% per year in December. In the last month of 2021, it was at 24.3%.

The Credit Cost Indicator (ICC) fell by 0.2 percentage points in December compared to November, at 21.4% per annum. The percentage reflects the volume of interest paid, in reais, by consumers and companies in the month, considering the entire stock of operations, divided by the stock itself. In practice, the indicator reflects the average interest rate actually paid by Brazilians on credit operations contracted in the past and still in progress.