One in six claims processed at the OCU are linked to the banking sector and a good part of them are related to revolving cards. The supreme has come to rule on three occasions. Already in 2020 it confirmed that the interests that exceed 20% are excessively high. Consulting lawyers in a situation of usury at this level is the only alternative left to victims who often remain vulnerable and unprotected in a vicious circle of debt accumulation that is difficult to manage.
The interest rate associated with revolving cards is currently at an average of 18%, although there are some of them in operation that even reach 28%. These figures become even more dramatic if we take as a reference personal loans and their 7% APR (which may drop in some entities to 3.65%). Although a priori these are two financial products oriented towards very similar purposes, the interest associated with each of them is dramatically different. We are talking about an extremely serious situation in which revolving cards can triple the amounts of interest on personal loans.
In both cases we are talking about alternatives that work with the same dynamics: The financial institution approves an amount of money that the client must later return with the corresponding interest associated with the service. However, in the case of loans, the money granted is entered into the destination account in one go. In addition, it is also a fixed product, that is, with an invariable amount: If the client requests a loan of 2,000 euros, he will receive 2,000 euros. The scenario changes if we talk about a revolving card, which becomes a means for the customer to access a credit (in this case, of 2,000 euros) but, in this case, much less transparent. In the event that he returned 500 euros and spent them again later, he would have accumulated a debt of 2,500 euros and not only that. It should also face the interests generated by that amount, that is, it is a dynamic system that easily escapes the user’s control and can very quickly compromise their personal finances.
Although revolving cards have become the focus of controversy over the last decade, the situation has worsened dramatically as a result of economic instability over the last three years. Being an easily accessible and immediate alternative whose approval is not subject to any feasibility study or economic solvency, it has proliferated alarmingly in thousands of Spanish homes, generating truly dramatic situations.
Its penetration into the social fabric has been propitiated by the lack of financial education and the misinformation that exists in this regard. They are sold in practically any public establishment. From shopping malls to supermarkets. In most cases, the clients who end up formalizing their contract carry it out in a rather inauspicious context. Massive environments that, in any case, welcome users who are not especially predisposed or prepared to carry out management of a similar nature. Most of them sign abusive contracts without paying enough attention to the contractual agreement or its clauses. In fact, in many cases, the purchase of revolving cards is the product of a confusion in which customers believe they are purchasing a credit card. However, in the case of revolving cards there is no limit and every time the cardholder returns the money, he has money available again to continue making purchases and, therefore, continue paying interest that is growing more and more.