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Last Monday (4), with the explicit support of the PT Caucus, the Chamber decided in plenary to speed up the processing of the Desenrola Program, which focuses on debt renegotiation, benefiting several families in Brazil. The Caucus introduced Provisional Measure 1176/23 into the bill (PL 2685/2022) proposed by Representative Elmar Nascimento (União-BA), which aims to establish caps on credit card interest rates. Representative Alencar Santana (PT-SP), the bill’s rapporteur, highlighted that Desenrola, an initiative of the Lula Government, already allows citizens to renegotiate their debts, restoring their financial health.
Furthermore, Santana emphasized the need to restrict credit card interest rates. “Currently, we face exorbitant rates, reaching an annual average of 440%. This causes many people to become indebted, creating a growing spiral of debt,” he noted.
He added that the bill proposes a cap: “Interest may not exceed the amount of the original debt. Currently, the average rate is around 440%. Therefore, our intention is to limit it to approximately 100%, a substantial and crucial reduction. It is an imperative action to combat financial exploitation in our nation,” he reiterated.
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Innovation in Debt Portability
Representative Santana also proposed, in his report, the portability of credit card debts and other associated debts, including those paid in installments. In this way, consumers are free to seek better interest rates to settle their outstanding debts. “This competition could result in an even sharper drop in interest rates,” he analyzed.
Setting Interest Rate Caps
The bill assigns the National Monetary Council (CMN) responsibility for determining maximum interest rates. Santana’s text specifies that the CMN has 90 days, after receiving suggestions from card issuers, to establish caps on interest and fees for revolving and installment payment methods. If there is no consensus among the parties, the legal guidelines take effect. The legislation proposes that interest and charges not exceed the initial amount of the debt, that is, not exceed 100% of the amount owed. Today, this rate exceeds 400% per year at several institutions.
Desenrola in Action
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Active since July, the Desenrola Brasil Program aims to encourage renegotiation by offering guarantees for smaller debts (limited to R$5,000). In just one month of the program, the Brazilian Federation of Banks (Febraban) recorded the renegotiation of approximately R$9.5 billion. Between July 17 and August 18, agreements were reached for 1.5 million debts, benefiting 1.1 million customers. The opportunity to join the program extends until December 31.
