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SAO PAULO, March 14 Interest rates for rolling
over credit card debt in Brazil may fall by up to 50 percent
under new rules, an industry group head said on Tuesday, as
banks respond to pressure from policymakers to ease the burden
on domestic borrowers.
Brazilians pay the highest interest rates among the world's
top 20 economies. President Michel Temer unveiled a plan in
December to slash interest rates on credit card debt to
alleviate pressure on consumers in the midst of Brazil's deepest
recession on record.
The president of industry group Abecs, Fernando Chacon, said
he expects average interest rates on rollover credit lines to
fall from an annual rate of around 406 percent to around 181
percent, the same level charged on secured credit paid by
The largest lenders, Itaú Unibanco Holding SA,
Banco Bradesco SA and state-controlled Banco do
Brasil SA, have already announced interest rates
"The new rules will probably reduce the high delinquency in
the revolving credit lines", Chacon said, noting that the fall
in delinquency rates would compensate for banks' lost revenue
from lower interest rates.
Delinquencies on revolving loans surpass 35 percent of
outstanding credit in the segment at present.
The central bank has been pressuring banks to reduce the
timeframe between purchases and payments to retailers, which
reach up to 30 days currently.
Rules to reduce the time between the transaction and payment
to stores are under discussion and no decision has been made,
Crossed subsidies within the credit card industry should be
addressed before changes in the payment period, Chacon said.
Abecs believes credit and debit card transactions in Brazil
could grow by more than the 6.5 percent originally forecast this
year due to an improving economic outlook, Chacon said.
(Reporting by Tatiana Bautzer; Editing by Daniel Flynn and