Consumer interest goes up in January

The interest on loans to individuals reached an average 52.6% per annum in January 2015, an increase of 2.5 percentage points compared to December and 6.9 percentage points in the past 12-month period.

Credit card interest was 73.3% p.a. in January, up 2.7 percentage points compared to December 2014, and 7.7 percentage points in the past 12 months.

Overdraft interest – credit provided to cover checks issued in excess of the funds available in the account – was an average 208.7% per annum, up 7.7 percentage points from the previous month and 54.6 percentage points from a year before. This was the highest rate since April 1996, when the overdraft interest rate was 212.26% per year.

The head of the Central Bank Economics Department, Túlio Maciel, admitted that there has been an increase in interest rates for all types of bank loans, putting it down to a policy of successive increases in the key interest rate (called the SELIC) pursued by the Central Bank in recent months.

The average interest rate for targeted-scope loans subject to government regulations stood at 8.2% annually in January for individuals (0.3 percentage points up from December) and 8.5% per year for businesses, an increase of 0.9 percentage points compared to the previous month.

Translated by Mayra Borges