Debts

Debt on credit card folds in just eight months

02/18/2013

This article was translated by an automatic translation system, and was therefore not reviewed by people.

Imagine cake recipes with different amounts of yeast. What's more, it grows at a much higher speed. This is what happens when we compare the evolution of debts incurred on the credit card, the overdraft, the booklet and card shop with investing the same amount in savings. While the value of the card debt takes just eight months to double in the client ledger waiting for long 14 years and one month (or 169 months) for the miracle of seeing the money doubles in size.

According to the vice president of the National Association of Executives in Finance, Management and Accounting (Anefac), Miguel de Oliveira, who made the request of the simulations EXTRA, financial market entities take into account, when calculating the interest rates in force.

- They consist of cost of funds, interest paid to the bank take money from a client and lend to another; taxes, administrative expenses, such as personnel and paper; default risk and profit margin of the bank or financial. Even with the high risk of default, nothing justifies the rates are as high as they are here in Brazil. Much research is needed before closing any credit transaction to see who offers the most advantageous conditions - warns Miguel de Oliveira.

The attendant Jose Magalhaes Maia, 42, is concerned about the expiration date of your credit card. The invoice in the amount of R $ 1,040.64, has to be paid until the next day 20, but he has no way to pay it.

- But not only think about settling iota! I'll get a loan to escape the high interest rates. Pay the card is priority - says.

Jose claims that the treatment given by banks is very different.- Do you trust your money to the bank and the return is almost zero. But when they lend to, interest is huge - complains.

The higher interest
To the economist José Dutra Vieira Nephew, even if the interest of Brazil were cut in half, still would be high:

- There is no country like Brazil, in terms of rates. No credit card, are the average interest of 9.37% per month. Peru, second highest in South America, charges 3.72% per month on average. Even if our interest were reduced by half, we would still be leaders.

In his view, neither is the default reason for banks and financial institutions charge such high rates.

- Generally, those who are indebted to the credit card faces problems with the overdraft. The way is to try to escape such interest, anyway - says.
One option is to raise money. If it does not to buy in cash, worth to give a good value entry and reduce the amount to be paid in installments.

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Source: Extra - Online

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This article was translated by an automatic translation system, and was therefore not reviewed by people.

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