{"id":605,"date":"2014-08-25T15:31:08","date_gmt":"2014-08-25T12:31:08","guid":{"rendered":"https:\/\/www.bondora.com\/blog\/?p=605"},"modified":"2014-08-25T15:31:08","modified_gmt":"2014-08-25T12:31:08","slug":"credit-card-refinancing-estonia","status":"publish","type":"post","link":"https:\/\/goandgrow.eu\/en\/blog\/credit-card-refinancing-estonia\/","title":{"rendered":"Credit card refinancing in Estonia"},"content":{"rendered":"<p>We recently experienced a major increase of applications from people looking\u00a0to refinance their credit card balances. The proportion of demand for refinancing other liabilities in Estonia\u00a0for the months in\u00a02014 amounts to nearly twice as much as\u00a0in our total portfolio with\u00a0all other countries included. The demand accounts to 160% compared to the same period in the last year. EUR 3 million of liabilities has been refinanced in Estonia in 2014 so far by the investors at <a href=\"https:\/\/goandgrow.eu\/\" target=\"_blank\" rel=\"noopener\">Bondora.com<\/a>.<\/p>\n<p>Since this is a significant increase in demand,\u00a0we decided to research the issues of credit card balance in Estonia in more detail.<\/p>\n<ul>\n<li>There were <strong>347,365 credit cards of which 233,777 are actively used<\/strong> at the end of June, 2014 in Estonia. Credit cards comprise 19.3% of the payment cards used in the country [1]. There\u00a0are\u00a0more than 0.5 credit cards per every\u00a0employed person\u00a0in Estonia. The amount of employed people in the Q2 of 2014 was\u00a0640,000 according to Statistikaamet.<\/li>\n<li>In 12 months from July, 2013 to July, 2014, Estonians generated <strong>EUR 1.45 billion of transactions using credit cards<\/strong> (POS terminal payments, online payments, cash withdrawals), with average transaction being EUR 159.45 [2].<\/li>\n<li>Monthly fee for credit card ranges from EUR 0.96 to EUR 5.11 [3], so <strong>Estonian credit card holders paid from EUR 4.0 to EUR 21.3 million in monthly credit card usage fees<\/strong> in the period of July, 2013 to June, 2014.<\/li>\n<li>Annual interest rates on credit card balances range from 16 \u2013 22% [4], producing <strong>APR from 16.8% per year <\/strong>(credit card with outstanding credit amount of EUR 1,500, interest rate of 16% and monthly fee of EUR 0.92) to <strong>46.5% per year <\/strong>(credit card with outstanding credit amount of EUR 250, interest rate of 22% and monthly fee of EUR 5.11) if one accounts for the monthly fees for credit card usage<strong>.<\/strong><\/li>\n<li>Out of EUR 1.45 billion of credit card transactions, <strong>EUR 291.3 million were cash withdrawals\u00a0<\/strong><strong>[5]<\/strong>. At the average bank fee of EUR 1.92 per withdrawal + 2.5%[6] of withdrawn cash amount<strong>, Estonians paid an estimated EUR 10.8 million in fees for cash withdrawals from credit cards<\/strong>.<\/li>\n<li>Penalty fee rates for overdue credit card balances range from <strong>8% to 107% per year<\/strong><strong>[7]<\/strong> on top of the interest rate depending on the type of card (revolving credit or charge cards).<\/li>\n<li>Cardholders getting into debt problems <strong>have limited options to refinance their credit card debts in other banks<\/strong>, as banks are reluctant to refinance problematic obligations of their competitors; thus, the borrowers turn to alternative financiers such as payday lenders or peer lending platforms.<\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n<hr \/>\n<p>&nbsp;<\/p>\n<p>[1] Source: <a href=\"http:\/\/statistika.eestipank.ee\/?lng=et#listMenu\/959\/treeMenu\/FINANTSSEKTOR\/620\/965\" target=\"_blank\" rel=\"noopener\">http:\/\/statistika.eestipank.ee\/?lng=et#listMenu\/959\/treeMenu\/FINANTSSEKTOR\/620\/965<\/a><\/p>\n<p>[2] Source: <a href=\"http:\/\/statistika.eestipank.ee\/?lng=et#listMenu\/962\/treeMenu\/FINANTSSEKTOR\/620\/965\" target=\"_blank\" rel=\"noopener\">http:\/\/statistika.eestipank.ee\/?lng=et#listMenu\/962\/treeMenu\/FINANTSSEKTOR\/620\/965<\/a><\/p>\n<p>[3] Source: websites of banks operating in Estonia<\/p>\n<p>[4] Source: websites of banks operating in Estonia<\/p>\n<p>[5] Source: <a href=\"http:\/\/statistika.eestipank.ee\/?lng=et#listMenu\/962\/treeMenu\/FINANTSSEKTOR\/620\/965\" target=\"_blank\" rel=\"noopener\">http:\/\/statistika.eestipank.ee\/?lng=et#listMenu\/962\/treeMenu\/FINANTSSEKTOR\/620\/965<\/a><\/p>\n<p>[6] Source: websites of banks operating in Estonia<\/p>\n<p>[7] Source: websites of banks operating in Estonia<\/p>\n","protected":false},"excerpt":{"rendered":"<p>We recently experienced a major increase of applications from people looking\u00a0to refinance their credit card balances. The proportion of demand for refinancing other liabilities in Estonia\u00a0for the months in\u00a02014 amounts to nearly twice as much as\u00a0in our total portfolio with\u00a0all other countries included. The demand accounts to 160% compared to the same period in the [&hellip;]<\/p>\n","protected":false},"author":11,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[120],"tags":[],"class_list":["post-605","post","type-post","status-publish","format-standard","hentry","category-stats-and-data"],"acf":[],"featured_image":null,"categories_names":["Stats &amp; Data"],"category_name":"Stats &amp; Data","_links":{"self":[{"href":"https:\/\/goandgrow.eu\/en\/wp-json\/wp\/v2\/posts\/605","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/goandgrow.eu\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/goandgrow.eu\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/goandgrow.eu\/en\/wp-json\/wp\/v2\/users\/11"}],"replies":[{"embeddable":true,"href":"https:\/\/goandgrow.eu\/en\/wp-json\/wp\/v2\/comments?post=605"}],"version-history":[{"count":0,"href":"https:\/\/goandgrow.eu\/en\/wp-json\/wp\/v2\/posts\/605\/revisions"}],"wp:attachment":[{"href":"https:\/\/goandgrow.eu\/en\/wp-json\/wp\/v2\/media?parent=605"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/goandgrow.eu\/en\/wp-json\/wp\/v2\/categories?post=605"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/goandgrow.eu\/en\/wp-json\/wp\/v2\/tags?post=605"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}