In spite of the outrageous interest rates practised by Brazilian banks, Brazilians mostly buy on hire purchase/installment plans. Many prefer to buy a product that costs R$100 cash paying R$1 during 150 weeks.
Because of this imposed love affair with the credit institutions, the prices on the shop windows often show the value of each installment and not the total value of the product. Take, for instance:
If you don’t pay attention to the small x5, you might reach the conclusion that Brazil is an incredibly cheap country. In the case I have just made up to illustrate my point, the price of a camisa (shirt) is R$200 – the result of multiplying 40 by 5 monthly installments.
Brazilian-issued credit cards allow their holders to buy on hire purchases/an installment plan. Banks from other countries don’t.
Unless it is mentioned on the price tag, hire purchase/installment plan doesn’t involve in-build interest rates.
á vista R$2.500
If you buy the digital camera on hire purchase/installment plan, it will cost you R$3.000 (10 monthly installments of R$300). However, if you pay for it up-front (à vista), it will set you back R$2.500.