Refrigerator credit, car financing and card change with Selic

The sequence of hikes in the basic interest rate, which this Wednesday rose to 12.75% per year, increases the cost of credit for consumers who seek installment purchases, car financing and use the revolving credit card.

If only the increase of one percentage point in the Selic is considered, the difference in the portion of a refrigerator purchased on the installment plan does not reach R$ 1 per month, according to calculations by Anefac (National Association of Executives).

That is, the rise in the Selic, in isolation, would not have a great impact if it were not the tenth in a row. The rate, which, from August 2020 to March 17, 2021, remained at 2%, has been increasing since then at each Copom (Monetary Policy Committee) meeting in an attempt to curb inflation.

According to Miguel José Ribeiro de Oliveira, executive director of Economic Studies and Research at Anefac, these consecutive increases in an environment in which Brazilian income is already contained due to inflation and unemployment will have a strong impact on new credit operations.

A personal loan of R$ 5,000, financed in 12 months, would have a monthly installment of R$ 528.44 with the previous Selic, at 11.75% per year. The same installment with the new interest rate rises to R$ 530.91, according to Anefac. The difference does not reach R$ 2.50.

However, if we compare with January of last year, when this installment would be at R$ 507.72 with the interest rate at the time, the installment increased by R$ 23 per month for the consumer.

For those who financed a vehicle worth R$40,000 in 60 installments until February last year, an installment cost R$974.42. Whoever is going to finance a car at the same value now, will pay installments of R$ 1,159.09 with the new Selic.

A refrigerator worth R$ 1,500, for example, would cost 12 installments of R$ 166.01 with Selic at 2%, according to Anefac simulation. With the rate announced this Wednesday, the installment rises to R$ 171.92.

“A difference that seems small, but that, in the current economic context of the country, reduces the purchasing power of the consumer and causes the indebtedness of families”, says Oliveira.

AVERAGE INTEREST RATES PRACTICED BY THE MARKET – INDIVIDUALS

Companies will feel the impact of the new Selic, mainly when resorting to banks for their working capital. If a BRL 50,000 loan with a repayment period of 90 days had interest of BRL 1,560.97 in January of last year, now it will be BRL 2,593.60.

“Some chains will embed the cost in the price for the final consumer. But others are not able to pass it on so as not to lose a customer and will have to absorb part of this impact”, says Oliveira.

AVERAGE INTEREST RATES PRACTICED BY THE MARKET – LEGAL ENTITY

Adjusting the Selic rate is one of the Central Bank’s tools to try to contain inflation, which has registered a constant high, pressured mainly by the increase in food and fuel prices.

Specialists, however, are already working with new hikes in the basic interest rate in the coming months, as the Ukrainian War affects the global market and the price of oil rose again in April, which should reflect on the inflation of the period.

The US also announced on Wednesday the increase in its interest rate. There, the rise was 0.5 percentage point, the highest since 2000. The US government also announced a plan to reduce its huge holdings in bonds, decisive measures aimed at containing the highest inflation in 40 years.

“It’s a different scenario. The US economy is growing, the impact of high interest rates will not be negative”, says Oliveira.