09/27/2023 – 10:32
Amid the beginning of the process of falling in the economy’s basic interest rates, the Selic, the average interest rate on free credit showed a reduction in August compared to July. The percentage went from 43.8% per year to 43.5% per year, the Central Bank reported this Wednesday, 27th. In the eighth month of 2022, the rate, in turn, was lower, at 40.6%.
For individuals, the average interest rate on free credit increased from 58.3% to 57.7% per year from July to August.
In the corporate segment, the rate varied from 23.0% to 22.6% between the two months.
Among the main free credit lines for individuals, the special check showed stability between July and August, with a rate of 132.0% per year. In personal credit, the rate went from 42.6% to 42.1% per year.
Since 2018, banks have been offering installments for overdraft debts. The option is valid for debts exceeding R$200. In January 2020, the BC began to apply a limitation on special check interest, at 8% per month (151.82% per year).
Data released this Wednesday by the Central Bank also showed that, for the purchase of vehicles, interest rates went from 26.1% per year in July to 26.2% in August.
Interest on total credit
The average interest rate on total credit, which includes free and targeted operations (with resources from savings and BNDES), went from 31.1% per year in July to 30.7% per year in August. In the eighth month of 2022, it was at 29.1%.
The Credit Cost Indicator (ICC) remained stable in August compared to July, at 22.5% per year. The percentage reflects the volume of interest paid, in reais, by consumers and companies in the month, considering the entire stock of operations, divided by the stock itself.
In practice, the indicator reflects the average interest rate actually paid by Brazilians in credit operations contracted in the past and still in progress.
The spread in credit operations showed a reduction/increase in August. Data released by the Central Bank show that the average bank spread on free credit went from 32.5 percentage points in July to 32.3 percentage points in August, the BC reported.
In the individual segment, the spread went from 46.9 to 46.4 percentage points between the two months. For legal entities, the average spread fell from 11.9 to 11.6 percentage points from July to August.
The spread is calculated based on the difference between the cost of raising funds by banks and what is actually charged to end customers (families and companies) in credit operations.
The average targeted credit spread fell from 4.8 to 4.7 percentage points from July to August.
The average spread in total credit (free and earmarked) went from 21.6 to 21.3 percentage points between the two months.
The default rate in free credit operations with banks remained stable at 4.9% in August compared to July (considering the revised data for the seventh month), informed the Central Bank.
While for individuals, the default rate fell from 6.2% to 6.1% from one month to the next, for companies, it rose from 3.2% (revised data) to 3.3% in the period – the highest percentage since August 2018.
Default on targeted credit (savings and BNDES resources) continued at 1.6% in August compared to July (considering revised data from the seventh month). The data that considers free credit plus targeted credit shows that the default rate also remained at 3.6% in August.
The debt of Brazilian families with the financial system ended the month of July at 47.8%, lower than in June (48.2%, revised data). The record in the Central Bank’s historical series occurred exactly one year ago, in July 2022 (50.1%). If real estate debts are discounted, debt was 30.2% in the seventh month of 2023, against 30.5% in June.
July was the first month of operation of the federal debt renegotiation program Desenrola. In the phase of the program that began on the 17th of that month – and is still in force -, it is possible to renegotiate bank debts of consumers who earn up to R$20,000 per month, without a guarantee from the National Treasury.
Furthermore, the names of people who had debts of up to R$100 in banks were automatically “dismissed”, without the commitments being forgiven. The second phase, for those earning up to two minimum wages (R$2,640), should begin in October and will be guaranteed by the Treasury.
According to BC data for the month of July, the commitment of families’ income to the National Financial System (SFN) ended the month at 27.6%. In June, the percentage was 28.3%, a record for the series. Discounting real estate loans, the income commitment was 25.5% in the seventh month of the year, compared to 26.1% in June (revised data).
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