renegotiation program Desenrola Brasil starts on Monday

As of Monday (17th), the federal government’s debt renegotiation program, Desenrola Brasil, officially begins. An ordinance published this Friday (14) in the Official Gazette by the Ministry of Finance regulates the rules.

The release coincides with a moment of record defaults. According to Serasa Experian, in May, there were 71.9 million people with credit restriction, which corresponds to 44.1% of the Brazilian adult population. The average debt per CPF was BRL 4,808.60, 15.1% more than in May 2022. Debts with banks and cards correspond to 31.9% of the total.

In the financial system, defaults by individuals corresponded, in May, to 4.25% of the financing and loan portfolio, according to the Central Bank (BC). It is the highest proportion since May 2016.

Those who owe up to R$ 100 may be removed from the list of negatives

With the beginning of the program, immediately around 1.5 million people who have debts of up to R$ 100 will be able to have their name removed from the negative lists of credit protection services such as SPC and Serasa. Thus, they will be able to access other forms of credit again or sign real estate rental contracts, for example.

The suspension of debt cancellation of up to R$ 100, however, does not represent debt forgiveness. According to the rules of the program, the consumer will still need to renegotiate the value if he is unable to make the payment at once. In the case of not renegotiating or not paying off the debt, the negative can be done again.

In addition, up to 30 million Brazilians with incomes of up to R$20,000 will be able to renegotiate bank debts, regardless of the amount they owe. Debts entered between January 1, 2019 and December 31, 2022 will be considered, a way that the government found to not encourage default after the announcement of the initiative.

The deadline for refinancing debt balances is until the end of this year. The procedure will be carried out directly with the creditor financial institutions, which will offer the facility through their own channels, after having qualified to participate in the program.

Thus, the terms of the rate and installment of renegotiated debts in this stage of the program will be made directly between citizens and the creditor bank.

If the citizen fails to pay installments and does not honor the other renegotiated amounts, he will be negative. In addition, charges will apply to the unpaid amount, such as interest on late payment and a late fee.

“We always have to encourage people to consume as long as they consume responsibly. Nobody can spend what they don’t have. If you have a debt, only make the debt you can pay. If you can’t pay, wait a bit. That if you do the debt and can’t pay, you’ll break your face “, said President Luiz Inácio Lula da Silva (PT) on Monday (12), at an event in honor of researchers at the Planalto Palace.

Among the banks that have already announced adherence to Desenrola are public banks Caixa Econômia Federal and Banco do Brasil, in addition to Itaú, Bradesco, Santander, Inter, Pan and C6. At this stage of the program, banks will not have the guarantee of the Fundo Garantidor de Valores (FGO), but, as a way of encouraging renegotiations, the government offers a regulatory incentive to increase the supply of credit.

Participating banks will be entitled to presumed credit, that is, early recognition of credit by the government, which improves the bank’s capital position, opening space to boost new financing.

The total amount of credits that can be used to renegotiate debts totals around R$ 50 billion, according to the Ministry of Finance.

The condition for banks to participate in the program and, therefore, be entitled to the incentive was the removal from the lists of credit bureaus of the names of those who have debts of up to R$ 100.

Second stage starts in September; government wants to benefit 70 million people

As of September, a second stage of the program will begin, which will focus on the low-income population and will rely on resources from the National Treasury as a guarantee.

In this phase, delinquent citizens who have an income of up to 2 minimum wages and financial and non-financial debts totaling up to R$ 5,000 may participate. Consumers with debts with banks, credit card companies, retailers and water, electricity and telephone companies, for example, may be included.

The only thing that cannot be financed are rural credit debts, real estate financing, credits with a real guarantee, operations with funding or third party risk.

Auctions will be held in which banks will bid with discount offers for each of the contracts in batches yet to be defined.

The bidders will sign contracts guaranteed by the FGO, a way to encourage the participation of financial institutions, which can voluntarily join the program.

According to the government, the Ministry of Finance will make R$ 8 billion available from the National Treasury for the guarantee fund.

Once the two stages of Desenrola are completed, the federal government estimates that it could reach up to 70 million defaulters.