The Price of Consumer Debt

Credit is a difficult issue in Latin America. Credit card APR interest regularly runs at 30-50 percent, upwards of five times what it is in North America. Bank loans are not a lot cheaper. Yet more than ever  Brazilian consumers are borrowing and financial institutions are encouraging them to do so. When I recently opened up an account at Itaú, Brazil’s biggest private sector bank, I was surprised to see that the checking account automatically included a 500R line of credit on the account (equal to about one month’s minimum wage)...

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