Brazilian Consumer Indebtedness Drops for First Time in 2019, Says CNC

RIO DE JANEIRO, BRAZIL – The percentage of indebted families in the country stood at 64.7 percent in October this year, below the 65.1 percent in September. The data were released yesterday, October 29th, by the National Confederation of Commerce of Goods, Services, and Tourism (CNC).

This was the first drop in the indicator this year, which accumulated nine consecutive increases in the monthly comparison.

When compared to October 2018, however, indebtedness is at a higher level, since at that time the percentage was 60.7 percent.

The percentage of defaulters has increased, as has the share of families who will not be able to pay their debts.

Default totaled 24.9 percent in October this year, up from 24.5 percent in the previous month and 23.5 percent in October 2018. Families who will not be able to pay their bills reached 10.1 percent, up from 9.6 percent in September and 9.9 percent in October.

According to the president of the CNC, José Roberto Tadros, after a period of strong credit growth, “the extra resources coming from the FGTS and PIS/Pasep (Severance Premium Reserve Fund/Social Integration Program) combined with the positive seasonality in the labor market, favored the reduction of indebtedness.

The credit card figured as the main type of Brazilian debt, pointed out by 78.9 percent of indebted families. Next, are the store cards (15.5 percent) and car loans (9.5 percent).

Source: Agência Brasil