Unrolling should increase recovery of defaults and raise profitability in consumer finance operations
the american bank Goldman Sachs sent customers a positive review of the Desenrola program, launched by the team of the Minister of Finance, Fernando Haddad, this week. campaign promise of Luiz Inacio Lula da Silva (PT), the initiative allows indebted people to renegotiate debts with creditors, such as banks and retailers.
For the financial institution, the project should increase the recovery capacity of non-performing loans and, ultimately, create greater profitability in consumer finance operations.
“We believe loans can be potentially lucrative,” Goldman Sachs analysts said in the report. In addition to financial institutions, retailers such as Carrefour (food), Lojas Renner (clothing) and Via Varejo (electronics and furniture), should benefit from an improvement in the market.
The program should bring relief to the purchasing power of Brazilians, reducing the level of indebtedness of families, which should benefit the activity in general, especially that aimed at the lower income population. Here’s the full of the report (215 KB).
In April, 71 million consumers (44% of the adult population) had negative credit, according to the Serasa Experian. These consumers accounted for BRL 341 billion in debt, implying an average of BRL 4,800 per person.
Bank debt represents almost 54% of the total. Non-bank debt is equivalent to 46%: the largest portion is concentrated in retail (15%), followed by utility bills (11%), such as water and electricity, and telecommunications (10%).
According to the program’s guidelines, only families with an income of up to 2 minimum wages (R$ 2,600) will be eligible for renegotiation.
According to Haddad, the program wants to remove 1.5 million Brazilians “immediately” from the list of defaulters, as banks that adhere to the initiative must remove from the list people with debts of up to R$ 100. The debts, however, will have to be settled later.
In exchange, the government will offer a guarantee for the renegotiation of debts of up to R$ 5,000, considered the sum of the debts. The guarantee will be made by the FGO (Operations Guarantee Fund) to finance the discharge. The renegotiated debt will be exempt from IOF (Tax on Financial Operations).
Debtors who adhere to Desenrola must settle their debts:
- in cash, with own resources, or;
- by contracting a new credit operation with an accredited bank. The amount can be divided into up to 60 installmentswith interest of 1.99% per month.
The project should start effectively in July.
PUBLIC BENCHES IN THE FRONT
There is an expectation that credit will initially be boosted through public banks. The Pronampe (National Support Program for Micro and Small Businesses) credit line, launched during the pandemic and aimed at small businesses, was mostly used by Caixa (32%) and Banco do Brasil (27%) –both state.
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