Demand for credit among Brazilians grew by more than 11% in May this year, compared to the same month in 2021. The numbers are from the Consumer Credit Demand Indicator, measured by Serasa Experian. According to the survey, most loans were requested by people who receive salaries between R$5 and R$10,000 per month. The advance in this income bracket was 13%, higher than the national average.
In the historical series, the highest percentage was recorded in the entire index occurred in May 2021, when there was a growth of 50.8%. The economist at Serasa Experian, Luiz Rabi, points out, however, that the percentage may not be an unrealistic representation of the survey’s history.
“In the same month, in 2020, there was a drop of 20.7%, due to the lockdown period. This invalidates this large 50% expansion. It is important to consider that, with the fall of last year, what would be a record growth means only a slight recovery”, he justifies.
In the analysis by regions, the North of the country concentrates the largest share of requests for credit. Altogether, the seven northern states are responsible for 17.8% of loan requests in this period.
Serasa Experian economist Luiz Rabi points out that unemployment levels may be one of the explanations. “The North has the lowest per capita income in the country. In addition, with high inflation, the low-income population ends up being very affected”, he recalls.
“With lower income, more credit is needed to supplement the monthly budget. Although this is not a recurring solution, as the population may end up in debt”, he says.
In the latest release of the Continuous National Household Sample Survey (Continuous PNAD), the unemployment level among the northern states, at 11.7%, was the second highest in the country. The percentage, in addition to being higher than the average of all states (11.1%), was only behind the Northeast (14.9%).
Rabi also draws attention to the use of these lines of credit in short-term basic demands to try to maintain a certain pattern of consumption. “Consumers, even with the high interest rate, continue to operate with the consumption model of necessity and using credit to honor financial commitments”, he explains. “In addition to supplementing the payment of priority items and services that could not be paid for with the usual monthly budget”, he adds.
For the professor of Economics at Fundação Getúlio Vargas (EESP/FGV), Alberto Ajzental, this scenario is a warning that the financial situation of the population that goes after the resource is not going well.
“If people aren’t able to close their monthly budgets and are resorting to loans to do so, then it’s bad credit. When the citizen asks for a loan, there is relief at the first moment. However, in the following month, it will be necessary to pay the installment of what was borrowed plus interest”, he ponders.
Given this scenario, the expert points out that the chances of greater indebtedness are high. “So, if mathematics wasn’t closed before, it won’t close later, because it makes the situation worse. People are turning to outside money to pay the bills. It will become the famous snowball. What must be done is to match expenses to income”, he emphasizes.
Despite this, the economist points out that granting credit is not a bad practice. “On the contrary, when it is used to buy real estate or vehicles, for example, it means that the economy is doing well and people are saving money. This shows that they are financially organized and that they will use the amount left over from the accounts, at the end of the month, to pay the financing installment. Getting into debt with a loan application can be a good thing, but this is not the case in the country today”, he concludes.
Source: CNN Brasil