Household debt rises in February to 78.3% of the total, points out CNC

Household debt rises in February to 78.3% of the total, points out CNC

The proportion of indebted Brazilian families grew 0.3 percentage points (pp) in February compared to January, to 78.3%, after two months of stability, said this Wednesday (8) the National Confederation of Commerce in Goods, Services and Tourism (CNC), by publishing the Consumer Indebtedness and Default Survey (Peic). Compared to February 2022, growth was 1.7 pp

Although it reached, in 2022, a record annual average in the historical series of Peic, started in 2010, the indebtedness – which considers any type of debt, including the use of credit card, even if paid on time – “had been pointing to a loss of breath since October” of last year, says the report released by the CNC.

The increase in February was driven by “payments of expenses typical of the first quarter (taxes, school expenses and contributions to class bodies, among others)”, continues the report.

The CNC also pointed out that the recent evolution of the labor market, with an improvement in disposable income, and the relief in inflation accumulated in 12 months, prevented new rounds of increase in defaults.

In February, 29.8% of the families interviewed by Peic reported having arrears, 0.1 pp below the registered in January. Compared to February 2022, there is an increase of 2.8 pp in this proportion.

On the other hand, Peic’s February reading does not signal continued relief in defaults. This is because 11.6% of families reported not being able to pay their debts, the same level as in January and 1.1 pp higher than that registered in February 2022.

“Those who have older debts continue to face difficulties in getting out of default, due to high interest rates. The proportion of consumers unable to pay overdue debts from previous months reached 11.6% of the total, stable in relation to January, but the highest proportion since October 2020”, says the CNC report.

Among defaulters, 44% have debts overdue for more than 90 days. “The average delay in payments was 62.7 days, the longest since January 2021,” says the CNC report.

Still according to the entity, the increase in the proportion of indebtedness in February was driven by families with incomes above three minimum wages.

Among the poorest families, who earn up to a maximum of three minimum wages per month, the proportion of debt fell from 79.2% in January to 79.0% in February. Among respondents earning three to five minimum wages per month, there was an increase from 78.8% to 79.4%.

Women

On account of International Women’s Day, celebrated this Wednesday, the CNC released some information disaggregated by gender in the February Peic.

Among women, indebtedness rose 1.1 pp in February compared to January, for 79.5% of the total number of respondents, above the aggregate variation – among men, there was a drop of 0.1 pp, for 77.2% of consumers interviewed at Peic.

Among indebted women, 18.8% consider themselves “very indebted”, while among men, this proportion was 15.5% in February.

“This indicates that financial and budgetary conditions are tighter for the female audience”, says the CNC report.

Default was also higher among them in February: 30.3% of respondents reported having overdue debts, while 29.1% of men did the same.

“But once in default, women seek to resolve the problem faster: while they spent an average of 62 days without paying debts, men remained 63.5 days with overdue debts,” says the report.

Source: CNN Brasil