Payday loan interest – what is it?

We know that the interest on the payday loan is one of the lowest in the market. But did you know that there is a rate cap set by the Ministry of Planning and the National Social Security Council? And that from time to time changes occur?

Recently, there was a change, for public servants the maximum rate was 2.05%. For retirees and pensioners, the limit is 2.08%.

Payday loan interest

With the drop in the basic interest rate in recent months, the government decided to reduce the interest ceiling on the payday loan for federal civil servants again from 2.20% per month, to 2.05% per month. The measure encourages the granting of loans under one of the types of credit for individuals with the lowest rates in the market.

Also the reduction in the interest rate ceiling on operations for retirees and pensioners. The payday loan ceiling, which was 28.9%, fell to 28.0% per year, representing a reduction of almost 1 percentage point. Per month, the percentage of payroll drops from 2.14% to 2.08%.

This reduction means savings in interest payments to civil servants and retirees of approximately $ 5 billion per year. It is more money left for the retiree and for the server to use for their needs.

Did you know?

The interest on your payday loan proposal that you are taking out today influences whether you want to refinance it in the future.

Today there is a policy of equal or lower rate. That is, if you take out a payday loan today at a rate of 2% and need to refinance this installment in the future, the bank cannot apply a higher rate than the one originally contracted.

This has an impact on the simulations we perform, because when the rate of the original contract is very low, it is usually not possible to cover it in the refinancing. When the interest rate of the original contract is higher than the current ceiling, the change (net credit to be released) can be very advantageous.

Undoubtedly, the payday loan, which was already one of the most advantageous forms of credit on the market, with this reduction in interest rates will guarantee you and your family savings and a great deal for the realization of your dreams.

Be sure to take advantage of this opportunity!