The contracting of credit cards in Zamora increases by 15%

Inflation and the proximity of Christmas are generating that sand increase the number of zamoranos who choose the credit card to make ends meet or make the purchases that take place on these dates, which can cause pronounced indebtedness for the population.

In this regard, the Bank of Spain notes that “risks to financial stability have increased due to geopolitical tensions and persistently high inflation”. In addition, they maintain that “economic growth projections for 2023 have been revised downwards and inflation projections have been revised upwards.”

According to the data collected by the supervisor of the banking system, there is a noticeable increase in the number of operations made through the Credit cards. Likewise, the branches of the province, In the absence of closing the results for the year, they maintain that the contracting and use of this means of payment could have increased by around 15%.

For their part, the city’s businesses point out that the payment method is polarizingbeing on the one hand the customers who always pay with cash to control the spending they make, and those who have joined the payment with credit card and rarely have cash.

This trend worries economic experts, since it could lead to widespread indebtedness among citizens, as occurred on numerous occasions during the 2008 crisis, in which the household economy was involved in a dangerous cycle of debt, credit to assume it and, again, debt. In this sense, the BdE points out that the current situation “negatively affects the payment capacity of households and companies, especially the most vulnerable sectors, with low incomes and a high level of indebtedness.”

Thus, another factor comes into play that gains weight, the request for quick loans with significant interest, difficult to assume for a large part of the population, which leads on numerous occasions to the request for a new loan with which to face the previous one. In this way, the sum between the amount owed to the bank for the use of the card and the accumulation of creditsit can cause the “perfect storm” and the first months of the year can be a true economic hardship for all those involved and for the economy as a whole, in a context in which the word “recession” sounds in the background.

The offer of loans shoots up due to the financial situation

The pandemic was an economic hit for many homes in Zamora. Closure of businesses, loss in sales volume, unemployment and other issues that led the population to “eat” savings to try to stay afloat. With three months to go until the third anniversary of the black march in which the pandemic was named, many families have not been able to recover, others have seen their situation worsen and many new ones have joined due to the rise in prices. prices.

For these reasons, there are many households that have seen the only way out of request a credit or microcredit with which to pay the electricity bill or try to continue opening their businesses. However, these “miracle solutions” end up being mere patches that undermine the situation and the pockets of the Zamoranos.

As usual every time there is an economic downturn, the supply of loans skyrocketsthe number of entities that promote quick economic amounts skyrocket, with interest taking over the fine print.

Although the credits were also peppered with the controversy of the revolving card, it is still common to see quite high interest rates, around 25%, and even higher in the case of microcredits. Currently, it is possible to request an economic amount of these characteristics even at the ATMs of some bank branches, increasing customer access to this mechanism.

In the same way, Other entities make a certain economic amount available to users what can be spent, and what will have to recover posteriorly, included in available balance the client’s, without prior noticenor any explanation about their conditions or interests.

Revolving continues to boom despite lawsuits filed

revolving cards, a payment method with which it is possible to defer and split payments of the purchases, supposed a headache for justice, due to the high interest charged by the banks. The Supreme Court ruling of March 2020 caused the lowering of the type of interestbut the reality is that people are still talking about and 20%a very high figure that ends up considerably increasing the payment that users must face.

In practice, the function of these cards is that of a microcredit. Unlike a conventional credit card, which defers payment until the end of the month or the following month without interest, revolving cards split payments and are subject to interest charges. Although many customers are in a situation of demand against their banks and their lawyers advise them not to use them, many continue to do so, further increasing the spiral of “economic debacle” in which they find themselves submerged due to the cost of interest.

Experts recommend avoiding payment in the long term

The experts are putting on the table a series of recommendations with which to make responsible use of the cards and other means of payment available. These include the option of avoid the “minimum payment”moving the remainder to the next month, with their respective interest in some cases; disable the option of cash advances with which the cashier gives the option of withdrawing an economic amount that will not “come out” from the bank account, but from a loan of the card itself; dodge long-term financing when it can be avoided; set a cap, a maximum amount of spending that can be done monthly with the card; request a document from the bank that contains the full requirements and characteristics of the contracted card; Y make an expense forecast adjusted to what can actually be disbursed.

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