THE CREDIT CARD AND THE INDEBTEDNESS OF BRAZILIANS

Abstract

The increase of demand for credit cards in Brazil has simplified financial transactions and boosted purchasing power. However, many Brazilians face the challenge of controlling their spending, which results in increasing debts with high interest rates and defaults. Therefore, the objective of this article is to investigate the relationship between the use of credit cards and the high levels of indebtedness among Brazilian families. The methodology used consisted of bibliographical research and the collect of documentary data from the Central Bank of Brazil, the Brazilian Association of Credit Card Companies and Services, the Consumer Indebtedness and Default Survey, and the Brazilian Institute of Geography and Statistics. The analysis revealed a significant link between the use of credit cards and the elevated levels of indebtedness among Brazilian families, especially during the pandemic. Although interest rates, particularly in the revolving credit mode, and economic indicators such as the SELIC rate and unemployment were factors to be considered, the research showed that the indebtedness rate continued to increase independently of fluctuations in these indicators.