Domino effect. This is how you can describe what has happened with the banks in Colombia this week, This is due to interest rate drops on various products they handle.
However, what are the real benefits that these adjustments can have for clients of financial institutions? We tell you.
(Reasons why banks lowered their rates on credit cards).
Jeisson Balaguera, economics expert and executive director of Values AAAstated what would be the reasons why the banks were successively lowering their interest rates, citing the example of Bancolombia.
(The banks that lower interest and the clients to whom it applies).
“Basically, there are banks and financial entities that are looking to take over several clients from Bancolombia. So what they do is offer lower rates than those of Bancolombia; This made the bank project that a significant portfolio of bank clients would leave, so they calculated the cost that this would have, so they preferred to lower rates, since there were many financial institutions that were offering interest rates at a better score than those of Bancolombia”.
(Colombia’s external debt: to whom does the country owe?).
For his part, Hernando Zuleta, professor at the Faculty of Economics of the Universidad de los Andesstated that the drop in interest rates could benefit people who did not have the ability to pay card advances before the adjustments made by banks in this regard.
“When rates were high, those who could pay their credit card in advance did so and those who could not were at risk of defaulting, that is, of not being able to pay their credits. In these circumstances, Bancolombia’s decision makes it easier for those who have debts with them, particularly credit card debts, to pay them, so that they are working for their own benefit.”.
(93% of Colombian couples would divorce because of money management).
In summary, according to the expert, The people who would benefit the most would be those who have a credit card and who have a large debt.
“The beneficiaries are the users who have a credit card and are highly indebted with it. This could be counterproductive if this drop in interest rates encourages consumption, which is what the Banco de la República wants to discourage with high rates. However, the rates are still so high and the situation is still so complex that I don’t think there will be a stimulus for credit card spending with this measure.“, sentenced Zuleta.
BRIEFCASE
