The President spoke out publicly saying that there is an excess of consumerism by using credit cards.

President Rafael Correa by a press conference expressed concern due to indebtedness that exists in the country, by the misuse of credit cards offered by private banks. He said that the banking sector is giving too much credit to people and many of these do not have to cover the amount of things that have purchased using credit cards.

The problem according to Correa

The president said that 60% of people who own card credit monthly minimum payment and canceling that barely minimum value is lower than their income as employees, but continue borrowing. It also claimed that 41% of families in the country has indebtedness, which is represented by approximately 400 thousand families in the nation and this could lead to serious problems in the national economy.

credit-cards

The problem also lies in the fact that in the banking sector are constant calls to customers to give them credit, with quotas that often exceed the financial capacity of these customers. He stated that excess credit makes people are constantly tempted to buy and often things that are unnecessary. According to a report by the Superintendency of Companies, in 2011 the total portfolio loans from banks in the private sector amounted to $ 171 million, 7000 million credit cards consumed by granting private banking, which represents a 2.44% for doubtful accounts.

The proposed solutions

The president announced that he would take steps to make banks more restrictive when granting loans. You must first make an analysis of the economics of the person before giving credit. Another possible alternatives proposed, there is a maximum quota according to each case and can not make all kinds of purchases with the card, meaning that there will be products and services that can not be paid through credit.

Position of banks

In the private banking sector stated that banks have sufficient liquidity to continue extending credit to your prospects, there is no reason why alarmed, and that percentage is on average the normal standards of the country. It was also held that when the credit card arrived in the country, created a change in the economy and that it was for reasons of growth and this is coming from the past decade. In short, there is nothing to worry about.