Proposal should limit credit card purchases to 12 interest-free installments

The president of the Central Bank, Roberto Campos Neto, presented a proposal that could limit interest-free credit card purchases to a maximum of 12 installments after legislation determines a ceiling for the charging of revolving interest. The project is still under study and the presentation of the first details took place at a meeting with representatives of commerce and the financial system in São Paulo this Monday (16).

According to the proposal, the Central Bank itself will carry out simulations to present to the sector the impact that the reduction in revolving interest rates will have on the market. Banks claim that interest-free installments are one of the factors behind high credit card rates.

According to the president of the Brazilian Association of Bars and Restaurants (Abrasel), Paulo Solmucci, who was present at the meeting, the numbers will be presented on November 7th. “He recalled that he has only one vote in the National Monetary Council (CMN), but said that, if there is consensus, the limit for installments on the card could be approved with the support of ministers Fernando Haddad (Finance) and Simone Tebet (Planning)” , said Solmucci in the newspaper record The globe.

The proposal that established a 100% ceiling on revolving credit was approved alongside the Desenrola Brasil project, and Congress gave banks a 90-day deadline to present suggestions that reduce the rate. If the sector does not meet the deadline, the regulations will define that the total charged for interest and charges cannot exceed the original value of the debt.

The final decision is expected by November, and banks argue that they bear the risk of default in interest-free installment transactions. The level of default in revolving credit is extremely high, with almost half of financing (49.5%) late in payment by more than 90 days, according to the Central Bank.

This criticism of banks targets independent acquirers, such as Pagbank and Stone, since the banks themselves control part of the sector. Cielo (formerly Visanet) is controlled by Bradesco and BB; Rede, through Itaú; GetNet, through Santander. Safra also operates in the sector.

The Brazilian Federation of Banks (Febraban) stated that it is working on alternatives to redesign revolving credit and improve payment in installments for purchases. However, he emphasizes that none of the models under discussion assume a rupture of the product.

The challenge also involves payment machine companies and merchants who split sales through these machines, anticipating the receipt of amounts from customers. Retailers argue that the ban on interest-free installments could make part of sales unfeasible.