Costa Ricans racked up credit card debt on TVs, travel during World Cup
After the blowup with Costa Rica’s once adored National Men’s Team coach, Jorge Luis Pinto, some Ticos were left with a bad taste in their mouths after an otherwise historic run in the 2014 World Cup in Brazil. Another thing many Costa Ricans might be grimacing from is credit card debt they racked up during those exhilarating weeks now that the first statements are due.
Elena Galante, corporate social responsibility manager for BAC Credomatic, told The Tico Times in a telephone interview that Credomatic, one of the largest issuers of plastic in Costa Rica, noted spikes in purchases of flat-screen televisions and international travel during La Sele’s run to the quarterfinals in Brazil. The social responsibility manager noted that many shoppers took advantage of World Cup promotions and might have bought more than usual.
“People definitely use their credit cards more when there’s euphoria, but now the fun has passed and it’s time to sit down and figure out what you owe,” Galante said.
Costa Rican credit card debt has been on the rise in recent years. The Ministry of Economy, Industry and Commerce, which tracks credit card use, reported that the number of credit cards issued and corresponding debt have been steadily increasing here. Between July 2012 and April 2014, Costa Rican credit card debt has grown 21 percent from ₡395 billion ($728 million) to ₡480 billion ($885 million). As of April, 1,764,609 credit cards were issued in Costa Rica. MEIC’s latest credit card report recorded total Costa Rican credit card debt at over ₡804 billion — roughly $1.48 billion — up 2.37 percent from the previous report, issued in January.
Some shoppers have tried to pawn their way out of their spending during the World Cup. Several local media outlets reported in July that electronics pawn shops have been inundated with flat-screen and smart TVs. The daily La Nación reported that stocks of flat-screen TVs in pawn shops jumped anywhere from 15 to 40 percent as Ticos rushed to unload them after the Netherlands eliminated La Sele on July 5.
Unfortunately, used plane tickets to Brazil don’t garner much resale value.
The social responsibility manager advised customers to always pay their minimum balance — and preferably more than that — to avoid tarnishing their credit score.
“After you’ve spent the money, you need to assess what you owe and how you’re going to pay it. But there are ways to prevent credit card debt by planning head and setting savings goals,” she advised.
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