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🇦🇷 Argentina /Economy & Trade

Sturzenegger defends Banco Nación’s new car loans

From La Nación · () Spanish

Translated from Spanish and summarized by DistantNews. Read the original for the full story.

At a glance

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  • Argentina’s deregulation minister Federico Sturzenegger defended Banco Nación loans for new and used vehicles, despite criticism of rates set at UVA plus 19% annually for salary customers.
  • The loans can cover up to 100% of a vehicle’s value, with terms of up to five years, while the outstanding balance and installments adjust with inflation-linked UVA units.
  • Sturzenegger said the longer term could expand auto financing and attract banks and investors offering cheaper alternatives if demand emerges.

Federico Sturzenegger defended Banco Nación’s new auto loans by shifting attention away from the interest rate and toward the five-year repayment period. The minister said the longer term could help create a larger market for vehicle financing.

The new scheme, added Monday to the bank’s +Autos con BNA program, finances up to 100% of the value of new cars, pickups and utility vehicles, as well as used vehicles up to 10 years old. Loans can reach 100 million pesos and do not require a lien on the vehicle. Terms range from 12 to 60 months.

Customers who receive their salaries or pensions through Banco Nación pay UVA plus a nominal annual rate of 19%. For other borrowers, the rate rises to UVA plus 25%. Because the principal adjusts according to UVA, which is linked to inflation, a lower initial installment does not mean the payment will remain unchanged over five years.

We always say with the President that a high price in a competitive market is exactly the kind of thing that is right, because it identifies a potential and unmet business opportunity.

· Federico SturzeneggerThe minister argued on X that high rates could encourage competing lenders to enter the auto-financing market.

Sturzenegger illustrated his argument with a 10 million peso loan. He estimated that a five-year loan at 19% would begin with monthly payments of about 260,000 pesos. Banco Nación’s official example put the initial payment somewhat higher, at 292,656 pesos for a customer paid through the bank. The bank said the figures are indicative and depend on current conditions and the borrower’s credit assessment.

The minister calculated that cutting the rate from 19% to 12% while keeping the five-year term would lower the payment to about 222,000 pesos. Keeping the 19% rate but shortening the term to three years would raise it to roughly 366,000 pesos. “The extension of the term is what is revolutionary here,” he wrote. His broader argument is that if borrowers accept the current conditions, competing banks and investors may later enter the market with cheaper offers.

The extension of the term is what is revolutionary here.

· Federico SturzeneggerHe emphasized the effect of extending repayment periods to five years on the initial monthly installment.
About this summary

Originally published by La Nación in Spanish. Translated, summarized, and contextualized automatically by DistantNews, with a note on how the source frames the story. Not individually reviewed before publishing. How this works.

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