card purchases become more expensive

The Central Bank returned to harden the stocks on the dollar making the financing of monthly consumption more expensivefraud card higher than US$200, with which it seeks to restrict the outflow of foreign currency.

Until now, Those who spent up to $200,000 with a credit card and financed the payment (that is, they did not pay the total summary) had a nominal rate of 53%, which will now go to 62%. And furthermore, from now on those who spend more than US$200 a month will no longer be able to finance themselves at the maximum rate of 62% but will have to pay 83%, which, applying the total financial cost (CFT), jumps to around 170%.

A few months ago the Central had cut off the possibility of paying expenses in dollars in dues tickets and tour packages. The entity ordered that all services contracted abroad that are paid by card must be paid in a single payment or financed with the rate of the “minimum payment” of the summaries, since the possibility of paying in installments was blocked. The measure complicates banks and e-commerce sites that offer the possibility of acquiring products marketed by large foreign platforms, such as E-Bay or Amazon.

In addition, a few weeks ago the BCRA announced a new tightening of the stocks that restricted the possibility of paying in installments by card in free shops. “Financial entities and non-financial credit providers may not finance in installments the purchases of their clients in tickets abroad and tourist services abroad (such as accommodation, car rental, etc.); products abroad that are received by the system of non-commercial postal deliveries; (and) products in duty-free stores,” he said.

Central Bank of the Argentine Republic.

The BCRA’s decision to making card consumption more expensive is linked to the strong increase it decided for the monetary policy rate, which last week jumped from 52% to 60%. This, in addition to raising the rates of fixed terms, also makes loans more expensive for families and companies.

The increase in the cost of financing with a credit card will have an impact on consumption, added to the fact that installment plans with cards have been shortening. For the consumer, paying in installments is convenient only when the rates are below inflation, but the retailers lose and that is why they have been shortening their plans.

generic purchase credit card -VALIDATION-

According to the Prisma Index -which manages the Banelco ATM network and the electronic payment of PagoMisCuentas-, among the mechanisms used by users to cover themselves from inflation is the credit cardespecially through official programs like Now 12.

The study noted that In the first semester, credit card transactions grew 10% year-on-year. The sectors that most increased their transactions with this means of payment were travel, tourism and airlines (97%), restaurants (63%) and clothing (54%), followed by purchases of auto parts and motorcycles (40%), service stations (28%), pharmacies (27%) and education and health (24%).

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