In Mexico, multiple banks have more than 26.3 million credit cards in circulation, according to data from the National Banking and Securities Commission (CNBV).
In addition to banks, there are institutions such as sofomes (multipurpose financial companies), fintechs and department and self-service stores that offer this product. In total, as of December of last year there were 31.6 million TDCs in the country, the CNBV revealed.
How to choose a TDC?
The first recommendation from Juan Luis Ordaz has to do with knowing your income and debt capacity. You should not allocate more than 30% of your income once you subtract your fixed expenses such as tuition, rent and payment of services, among others.
You also have to know the annuity amount and, more importantly, the total annual cost (CAT), to calculate the total cost of financing a loan; includes the interest rate, annuity, insurance and commissions.
Compare several options so you know which credit card best suits your needs. Each institution offers rewards or benefits to its cardholders. Bank of Mexico (Banxico) has a comparator based on the CAT.
Since you have your TDC, always keep two dates in mind: the cutting and payment. The first is the date on which the bank marks the end of a period of your credit cycle; You will usually have 20 days to pay. Your payment date is the deadline you have to cover your debt, whether partially or totally.
Consider being total and forget about paying interest. By paying the full amount of your debt before your payment date, you will be financing yourself almost free of charge for up to 50 days.
If you cannot cover the total amount of your debt, pay more than the minimum, otherwise you will incur default interest which can amount to up to 120% annually.
If you make purchases monthly without interest, cover the total amount so as not to generate interest.
Review your account statement every month. Either in print or digitally and know your balances and movements made during the current and previous period. Lean on your bank’s app to keep better control of your income and expenses.