INSS payroll: banks have 90 days to report interest – 06/15/2023 – Market

Banks will have a period of up to 90 days to adapt to the new payroll loan rules and start reporting the interest on credit operations, among other data, to INSS (National Social Security Institute) policyholders, as decided by the CNPS ( National Council of Social Security).

The measure is in an ordinance published in the Official Gazette of this Thursday (15). The deadline may be extended for another 90 days, if necessary. The extension of the deadline, however, must be justified by the banking network.

What banks should report to the INSS

• Monthly and annual interest rates
• First discount date
• Monthly and annual CET (Total Effective Cost) of payroll operations
• Amount paid as a customer debt (original balance due) when the operation is portability or refinancing
• Amount of IOF (Tax on Financial Operations) levied on the operation
• Daily information on interest rates for new payroll personal loan, payroll credit card and payroll benefit card operations
• SAC number (Customer Service) or CAC (Consumer Service Center)

According to the INSS, the disclosure of interest must be made through the Meu INSS application or website after a period of 90 days. For now, policyholders are still unable to see this information on their statements.

In the ordinance, the body determines that financial institutions that already have such a system must provide “information on registration, refinancing and portability in all new payroll loan agreements to INSS beneficiaries from 07/01/2023”.

The validation of the information will be carried out by Dataprev, a technology company of the federal government responsible for services such as Meu INSS, Gov.br and others, “provided that they comply with the Resolution of the National Council of Social Security (CNPS) in force”.

Currently, there are 16.8 million retirees and pensioners with payroll loans. Data from the institute indicate that in April of this year, 1.058 million new contracts were signed, a number well below the 2.3 million contracts in April 2022.

The drop in demand can be explained by the period in which banks did not offer this type of loan after the CNPS lowered interest rates to 1.70% on personal loans and 2.62% on credit cards and the INSS payroll card.

The situation was only normalized with the intervention of President Luiz Inácio Lula da Silva (PT), who held a meeting with government and bank representatives. As a result, the CNPS raised the rate to 1.97% for the loan and 2.89% for the card, still below the 2.14% and 3.06% for the loan and the card, respectively, practiced between December 2021 and the beginning of March 2023.

INSS payroll interest is limited, this means that banks can charge less, not more than the defined percentage. Currently, rates are disclosed by the Central Bank, but they tend to be lagged in relation to what is being practiced by the market, since there is a lag between the offer of the rate, the information that the bank provides to the BC and the disclosure made by the monetary authority.

In addition, there is no obligation for banks to report the interest charged.

See the interest on the INSS payroll loan

• The rates below correspond to the interest charged by banks and finance companies between May 25 and 31, 2023, according to data released by the Central Bank

Institution	Interest per month (in %)	Interest per year (in %)
Banco Sicoob SA	1.61	21.16
Paraty CFI SA	1.71	22.6
Banco Bradesco Financ. SA	1.74	23.04
Banco Cooperativo Sicredi	1.77	23.42
Banco Bari	1.79	23.77
Banestes Bank	1.81	23.98
Agibank	1.81	23.99
BRB – CFI	1.82	24.09
Financial HS	1.84	24.4
Banco Inter	1.84	24.52
Paraná BC	1.85	24.66
Bank C6 Consig.	1.86	24.69
Caixa Econômica Federal	1.87	24.83
Alfa SA CFI	1.88	24.98
fact SA	1.88	25.09
Banco Paulista	1.89	25.15
Bradesco	1.89	25.24
Amazon bank	1.9	25.38
BMG	1.91	25.43
PAN Bank	1.91	25.49
Santander	1.91	25.53
State Bank of RS	1.93	25.71
Bank of Brazil	1.94	25.93
Itau Payroll	1.96	26.25
Daycoval	1.97	26.35
Safra Bank	1.98	26.48
Zema CFI	1.98	26.49
Itaú Unibanco	1.98	26.56
Crefisa	1.99	26.64
Mercantil do Brasil	2.01	26.94
Bank of Northeast Brazil	2.01	27.03
Gazincred	2.02	27.12
SE State Bank	2.08	28.03

In a note, Febraban (Brazilian Federation of Banks) states that the INSS normative instruction “contributes to bringing greater transparency to payroll loan operations”. The measure complies with the recommendation of the CNPS.

About the data that will be sent by the banks to Dataprev, the federation says that the new normative act of the INSS should make information about the term available in more detail.

In addition, according to Febraban, disclosure will also depend on “development and approval between financial institutions and Dataprev”, says the note.

HOW DOES THE INSS CONSIGNMENT WORK?

Payroll is a credit with a direct discount on the payroll. Interest is controlled by the CNPS. The fee set on the board is the maximum that can be charged. The INSS insured can commit up to 45% of the benefit with the payroll loan. Of this total, 35% are for the personal loan, 5% for the credit card and 5% for the benefit card, created last year.