Revolving credit: what is it? Meet the new rules
In April of this year we saw a lot of information circulating about the new rules. It turns out that a lot of people are asking themselves “revolving credit: what is it?”
Keep reading this post and see what changes to the revolving credit started coming out on April 3.
Revolving credit: what is it?
Every credit card user, upon receiving their invoice, has two payment options: the minimum amount and the full amount.
The minimum value refers to 15% of the total value, and is used by the card user when he is unable to pay the full amount.
In the past, the user could pay the minimum for several months in a row, accumulating exorbitant interest in this type of use.
To get an idea, according to Central Bank research for 2016, the interest rate of the newspaper was at 484.6% per year, considering the average of all financial institutions.
This high value is capable of causing budget damage for any family that can not afford better conditions to pay the full amount of the invoice.
In addition, your name can also be enrolled in the Credit Protection Service (SPC), making purchases and financing requests impossible. We have already spoken here in Herne the Hunter about the personal loan to the negative.
What has changed in the revolving credit?
In the new rules of use of the rotary, customers can pay the minimum for only one month.
It is necessary that financial institutions subsequently offer another form of loan to the client, at much lower interest rates.
The intent is to encourage consumers to clear their debts without being devoured by that snowball of interest from the rotary.
As the customer can only pay the minimum for a month, on the next invoice, the bank needs to ensure consumer credit installments the card debt with rates lower than the current interest of the card.
Despite these changes, the most effective tip for the credit card user is to make the use of this payment method consciously.
Despite having an approved limit on the card
the customer needs to remember that this value is not real, it is not a money that he already owns, but it works as a loan at very high interest rates.
In other words, it is necessary to put it on the balance and evaluate if it is necessary to buy it on the credit card or if other forms of payments are more viable.
This awareness of using the card in cases where it is extremely necessary, choosing to buy cash or debit, whenever possible, causes the credit card user to be somehow armored against the interest of the machine.