Credit Card Explosion and Hidden Costs
The availability of credit cards has exploded, with just a few clicks and some personal data allowing you to obtain one in less than five minutes. However, what’s the cost of this convenience?
Daniel Urías, founder of Cooltura Financiera, states, “Rapid and easy credits are usually quite expensive; in the case of credit cards obtained through an app, they come with high-interest rates.”
Credit Card Comparisons
Nu Credit Card
Issued in national currency, backed by Mastercard, with national and international coverage.
- Average CAT: 163.88% (excluding VAT)
- Standard interest rate: 99.9% (annual, excluding VAT)
- Annual fee: 199 pesos/year (excluding VAT, free for the first three months)
- Replacement card: Free
- Additional card: Free
- Credit disbursement via electronic transfers: Up to 199 pesos (excluding VAT) per transaction
- Cash withdrawal via ATMs charged to credit: 199 pesos (excluding VAT)
- Subscription to Plata Plus Program: From 39 to 99 pesos (excluding VAT)
- Up to 200,000 pesos credit upon application.
- Offers 0% interest for up to two months
- Cashback: Up to 15%
- MSI on purchases from 100 pesos, both online and abroad.
Plata Card
National currency line of credit, backed by Mastercard with national and international coverage.
- Average CAT: 163.88% (excluding VAT)
- Standard interest rate: 99.9% (annual, excluding VAT)
- Late payment fee: 300 pesos (including VAT)
- Contract activation fee: 500 pesos
- Replacement card for theft, loss, or damage: 150 pesos (including VAT)
- Unauthorized account clarification: 300 pesos (including VAT)
- Balance inquiry at foreign ATM: 25 pesos (including VAT)
- Balance inquiry at other financial institutions’ ATMs or abroad: 10 pesos (including VAT)
- Cash withdrawal at other financial institutions’ ATMs: 10% of the disbursed amount.
- No annual fee.
- MSI
- Discount for on-time payments
- Loyalty programs and exclusive promotions
- Credit limit: 500 to a maximum of 23,000 pesos.
Stori Green Credit Card
National currency card, backed by Mastercard with national and international coverage.
- Weighted average CAT: 191.4% (excluding VAT)
- Weighted average standard annual interest rate: 111.2% (excluding VAT)
- Late payment fee: 300 pesos (including VAT)
- No annual fee.
- MSI
- Discount for on-time payments
- Loyalty programs and exclusive promotions
- Credit limit: 500 to a maximum of 23,000 pesos.
Klar Credit Card
National currency card, backed by Mastercard with national and international coverage.
- Average CAT: 187% (excluding VAT)
- Weighted average annual fixed interest rate: 123.1% (excluding VAT)
- No annual fee
- Contract or activation fees: 0 pesos
- No penalties for minimum usage.
- Replacement card fees: 0 pesos
- Cashback: Depends on your level in the rewards program.
- Cash withdrawal up to 70% of your credit line, based on your credit score.
- 3 to 24 MSI.
Growing Market
There are approximately 50 million bank and non-bank credit cards in the country, many held by young adults. According to Bravo (formerly Resuelve tu deuda), 48% of Mexicans surveyed acquired their first credit card when they began working, aged 19 to 24.
BBVA believes that having a credit card for young adults is beneficial, provided there’s proper control over its usage.
Benefits include building a credit history at an early age and learning about financial culture.
Key Questions and Answers
- Which credit cards have the highest average CAT (Costo Anual Total)?
- Stori Green has the highest average CAT of 191.4% (excluding VAT).
- What are the standard interest rates for each card?
- Nu: 99.9% (annual, excluding VAT), Plata Card: 99.9% (annual, excluding VAT), Stori Green: 111.2% (weighted average annual), Klar: 123.1% (weighted average annual).
- Are there any annual fees for these credit cards?
- Plata Card has an annual fee of 199 pesos/year (excluding VAT), while Klar and Stori Green have no annual fees.
- What are the late payment fees?
- Plata Card: 300 pesos (including VAT), Klar: None mentioned.
