Credit cards cost more for Brazilians, says EESP professor

Interest rates on credit cards in Brazil are higher than those of Latin American countries such as Argentina, Chile, Colombia, Peru and Mexico. That is what the survey conducted by the Brazilian Association of Consumers' Rights (Proteste), in partnership with the professor of São Paulo School of Economics (FGV/EESP) Samy Dana, reveals. The study points out that Brazil's interest for revolving credit (type of credit that does not pay the full value of an invoice) is up to 70 times higher than the base rate - which is equivalent to an average interest rate of 280.82% per year. The numbers also raise more attention when compared to other countries. The rate used in Brazil is 525% higher than Peru, which charges 44.8% per year. The lowest percentage is in Colombia with an annual rate of 28.31%.The rule that applies is: the easier the money, the more expensive it will become. Credit cards and overdraft account checks are the two modalities which are more readily available and more expensive, explained Samy Dana in an interview to Portal G1. Also according to him, the fees charged on cards for revolving credit are one of the primary causes of the growing indebtedness among Brazilians.The economist also warned that in addition to revolving interest, four other types of interest may incur to the credit card bill: annuity charge, withdrawals, invoice payment in installments and purchases in installments. In order to avoid them, it's necessary to take some precautions, such as making arrangements to pay the full amount of the invoice (and on its due date), avoid making credit card withdrawals and look for stores that do not charge interest to divide purchases in installments.In Brazil, a research made a survey on the interest rates charged on revolving credit for 60 credit cards, distributed in 11 financial institutions.