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The competition that commercial banks launched into last Friday, after Bancolombia announced a lower interest rate to half of credit cardshas implications that could affect the monetary policy of the Banco de la República, but they also have to do with the policy of the Government to stimulate the popular economy.

In the first case, several analysts considered that despite the fact that the 6 million cards (out of a total of just over 16.1 million plastic ones) covered by the decrease in interest rates by eight banks is important, they would not pose a significant challenge to the policy that the Banco de la República has been advancing since September 2021 to restrict consumption by raising rates.

(The benefits for users of lowering bank rates).

Although the bankers say that the decreases are aimed at explaining that with the measures they are supporting families, especially those of the lower middle class and farmers at a time of high interest rates, behind it is the intention to keep the credit channel open and even more so when the figures They say that there is a negative trend in the use of card slots.

This indicator, when compared to the increase in the usury rate, has an inverse relationship, which means that peopleAs is natural in a scenario of higher costs, the use of plastics decreases.

(Does banks’ decision to lower interest rates contradict Banrep?).

The economic analyst Alexander Martinez argues that this mainly affects household consumption and therefore trade in general and this phenomenon was reflected in the last quarter of 2022.

Related to the above, It must be remembered that usury is a figure towards which the costs of the credit cards of various entities issuing these plastics have always approached and which is currently at 46.26% EA

Martínez points out that this has further slowed consumption and in line with the downward revisions of economic growth and in this context, “Bancolombia (with a total of 2.6 million plastics) lowered the interest on its credit cards with quotas up to $3.9 million, a move that will benefit its medium- and low-income clients, whose cash flow may be more affected by the increase in quotas”.

(The banks that lower interest and the clients to whom it applies).

They have followed the move Davivienda that last November had 1.4 million credit cards, Bank of Bogota with 1.4 million, Western Bank con 572.000, Scotiabank Colpatria with 2.2 million, Pichincha Bank con 12.000, BBVA con 860.000, agrarian Bank with 340,000 and up He findsfor some credits.

for the economist Jorge Restrepowhat happens since Friday is the result of competition in credit in the very high-cost segment, where there are many suppliers in the consumer category, since in others it is more difficult to make such competition.

“Actually, this does not have a macroeconomic effect, but it is not negligible because it can be positive for millions of families that have a credit card and it is good that they can move to where there are better rates.“, said.

The economist assures that this credit affects millions of people but its impact on the economy is not necessarily great.

Andres GiraldoProfessor of Economics at the Javeriana Universitypoints out that a small effect could be generated in the monetary policy and that the cancellations of the banks are part of what each entity considers that it can collect and warns that with this “The system could shoot itself in the foot, as it would show that the intermediation margin is very high and if the banks fall in coordination or to compete, one wonders why they didn’t do it before. If they do it, it is because it is profitable to charge 20 or 25%”.

Edgar Jiménez, Professor of Finance at the Jorge Tadeo Lozano University ensures that there could be a small effect on the Issuer’s policy, although the segment whose cost was lowered does not even account for 10% of the total portfolio.

Another aspect to analyze is what is reported in the financial sector about contacts that have been made for several weeks between the Treasury and other public entities with spokespersons for the banks and with the gaze of the Presidency.

In that sense, the Government would stimulate the adoption of measures to generate a boost in low and medium sectors and in the so-called popular economy.

Proof of that was given by himself. Minister of Finance, José Antonio Ocampowho on Friday on the social network Twitter said that the “Dialogue between @petrogustavo @infopresidencia @MinHacienda @SFCsupervisor and the financial sector bears fruit: @Bancolombia @Davivienda @Bco_Occidente @BBVA_Colombia @BancodeBogota lower rates for low-amount loans. And announcement: more support is coming to the popular economy”.

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