Caixa announced on Friday (4) the suspension of the release of new Auxílio Brasil loans until 7am on November 14th. The reason for the suspension: the bank stated that Dataprev will be processing the payroll for the month of November during this period.

Therefore, as of 7pm on November 1st, the bank is no longer releasing the consignment. This occurred, two days after Jair Bolsonaro (PL) failed to win re-election, losing to Luiz Inácio Lula da Silva (PT). According to Caixa, since the beginning of the loan grant, R$ 5.5 million in loans have been made available.

The bank stated in a note that “CAIXA informs that during the processing of the Auxílio Brasil payroll, a process involving DATAPREV, CAIXA and the Ministry of Citizenship, from 7:00 pm on 11/01/2022 to 7:00 am on 11/14/2022, the consignee will not be available for hiring“.

The introduction of the credit modality was one of Jair Bolsonaro's bets to get votes in his bid for re-election this year. The measure is surrounded by discussion and controversy, as it poses the risk of over-indebtedness for an economically vulnerable population.

For IDEC (Brazilian Consumer Protection Institute), payroll loans are an opportunistic policy. Furthermore, the Institute highlights the risk of negative effects for the population who decide to take out the loan.

Furthermore, IDEC argues that the government-set maximum interest rate of 3.5% per month is highly abusive. “Because it is significantly greater than other types of payroll loans, such as for retirees, pensioners and public employees, currently practiced“, said the company.

At the end of October, the TCU (Federal Audit Court) even asked Caixa to suspend loans until the Court analyzed the regularity of operations. 

On the other hand, according to Caixa Econômica's assessment, the loans may be an opportunity for Auxílio Brasil beneficiaries to pay off loans with higher interest rates. For example, the credit card.

“Customers who have high-interest loans can check whether the loan has cheaper interest rates and use the amount to pay off more expensive debts.“, argues Caixa.

In September, the federal government's decree was published authorizing operations with the Auxílio Brasil consignment. However, the release of credit began after the 1st round of elections, with the registration of queues at Caixa branches. Even beneficiaries who leave the social program will have to pay the debt.

Currently, Caixa released a payroll loan with an interest rate of 3.45% per month. The maximum monthly installment is R$ 40% of the basic benefit, which is R$ 160. The minimum installment of the loan is R$ 15 per month. Loans have a term of up to 24 months.

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