In our guide today, we will look at how the Absa budget facility work in South Africa.
We will begin by showing you what exactly a budget facility is.
What Is A Budget Facility
You can choose to purchase things on a straight or budget with your credit card.
Straight purchase means you intend to repay at least the minimum monthly amount of 2.5% of your outstanding balance.
When you choose a budget, you have to choose your repayment period. You can opt for 3, 6, 9, 12, 18, 24, 36, 48 or 60 months.
Now that you understand what a budget facility is, we will go ahead and show you exactly how it works in South Africa.
How Does Absa Budget Facility Work
The budget is basically like having a separate credit card, and you pay it off with another credit card monthly.
The longer the period for the budget facility, the lower the monthly repayments.
You will also pay more interest if you take a longer time.
You can pay your budget early directly in internet banking if you feel you have enough money in your account.
For example, if you buy something on a nine monthly budget and three months into it, you feel that you have enough funds, you can pay it off in one straight amount.
If you make a purchase worth R6,000, your card will not deduct the entire amount.
Instead, a small down payment will be taken, and you will pay an installment every month to cover the R6,000.
You can view your budget facility status in the Absa online banking websites and apps.
You can not use the budget facility to buy travelers’ cheques, foreign currency, make home loan repayments, or fill up fuel.
This is generally how the Absa budget facility works in South Africa.
With this information, we will now show you the amount you can spend with your Absa budget facility.
How Much To Buy To Buy The Absa Budget Facility
The limit to our budget facility depends on the amount of credit available for you.
For instance, if your credit limit on your card is R30,000, but you have used R20,000, it means you still have R10,000 available for you.
You can use this available balance on either straight or budget.
Every time you use the card, your funds will decrease and increase every time you make your monthly payments.
That is all you need to know about how the Absa budget facility work in South Africa.
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