To “Parcelar” or Not to “Parcelar”

We’re all used to charging purchases on credit cards and then paying off the balance each month. Or you can pay interest each month and leave a balance on the card. But what if we said you could pay every purchase in installments?

It’s actually very common in Brazil. Go to a store, make a purchase, and you’ll likely be asked if you want to pay in parcelas (i.e., installments). You might even get asked how many parcelas you want - 3, 6, 9, or 12. Whether it’s a TV, clothing, or even groceries, Brazilians have come to rely on the ability to buy now and pay later.

Best of all, consumers generally don’t get hit with finance charges or other fees for paying in installments. Rather, the credit card company assumes the risk of nonpayment and the retailer pays a higher transaction fee for offering the installment option. After all, a seller who can offer sales in installments has a better chance of convincing a buyer to make a purchase.

If you’re in the mood to negotiate, you might find that offering to pay upfront - that is, with no installments - gets you a bit of a discount. You might also finagle a deal by offering to pay in cash. After all, both you and the retailer benefit when the credit card company isn’t financing the purchase.

But if installments or credit card purchases aren’t your style, perhaps you’ll prefer paying by boleto. Are you confused? Stay tuned.