Brazil consumers warned about exploding credit card debt and high loan interest

Brazil's revolving credit system can cause debt to increase dramatically. A case publicised by the Federal District Consumer Protection Secretariat showed a credit‑card balance that grew from about R$12,000 to roughly R$788,000 over four years due to the high‑interest rates applied to unpaid balances. The Central Bank and the Monetary Policy Council have introduced rules to limit debt growth and encourage repayment plans, aiming to protect households from such exponential accrual.

Many Brazilians also sign loan contracts with interest rates far above the market average. While the typical personal loan rate is around 4.5% per month, contracts often charge 8% to 10% per month. Consumers can challenge these abusive rates by comparing the contract’s CET with official averages, negotiating directly with banks, and, if necessary, filing complaints with Procon or the Central Bank’s complaint registry. Practical steps and calculation tools are provided to help borrowers reduce payments and potentially recover excess costs.