Credit cards: how much will it cost to refinance balances if a minimum payment is made

Last week, the Central Bank (BCRA) raised its reference rate, which was 49% from 47%. It affects savers in at least two ways: it increases revenue on fixed terms and credit costs. This way, refinancing credit card balances is when the minimum is paid or the sum of what is consumed in the month is not paid, it rises to 53% annual nominal.

Approximately 40% of plastic holders use, monthly, this possibility known as rotating.

The rate charged by banks to refinance balances of up to $ 200,000 is capped at a nominal 43% annual rate from the beginning of 2021 to January of this year. There, BCRA raised it to 49% with the initial rate adjustment and in March the cost was 51%.

From Communication “A” 7512, published in the Official Gazette on Thursday, that amount rose another two points and reached 53% in June.

According to the BCRA decision, announced last Thursday, the cost is rising two points above what it is so far. Here we must add the additional costs that arise as a result of this operation, the Total Finance Cost -which depends on each bank- is at 81% per year.

Unlike what usually happens, now it is better to pay the minimum of the card than to take out a personal loan to pay off that debt.

Updating values ​​to inform movements

The Federal Administration of Public Revenues (AFIP) has updated the minimum amount by which banks must report the movements of both accounts and credit cards. The last time the amount was updated was at the end of January, when it went from $ 10,000 to $ 30,000.Now, amid accelerated inflation, that amount would be $ 90,000.

This was recorded in the Official Gazette, by new Resolution 5138/2022, published on Monday. The lowest number to report accreditations, withdrawals, account balances and deposits on time it would be $ 90,000.

With an inflation not easing, on Thursday the data for April was known, which is stood at 6% and left annualized inflation at 58%, AFIP again touched on the minimum at which banks must report certain movements. This way, entities will be able to streamline operations and, in turn, will receive automatic and permanent information on monthly accreditations, withdrawals, account balances, time deposits and card consumption.

Card operations

operations with the credit card recorded a balance of $ 1,404,116 million, indicating an increase of 4.5% compared to the end of the previous monthabout $ 60,082 million above March but below expected inflation.

Year-on-year growth reached 43.8% and also did not reach the inflation level at the time.

Regarding dollar consumption with a credit card, they registered a year-on-year increase of 178.7%. In April there was an increase of 12.2% compared to the previous month. The reactivation of overseas trips boosted balances last month.

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