Brazilian Chamber approves bill to renegotiate Funproger loans

The Constitution and Justice Commission (CCJ) of Brazil's Chamber of Deputies approved Project Law 4,774/2023, which authorises Banco do Brasil and Banco do Nordeste to renegotiate debts of borrowers linked to the Fund for Guarantees for Job and Income Generation (Funproger). The proposal, authored by Deputy Domingos Neto (PSD‑CE) and reported by Deputy Luiz Gastão (PSD‑CE), includes technical adjustments and sets negotiation terms such as discounts on charges and fines, repayment in up to 120 months and an interest rate equal to the Long‑Term Rate (TLP). A future regulation may allow lower rates for low‑income debtors. The renegotiation applies to loans contracted at least seven years ago that were recorded as delinquent on 31 December 2022. Funproger, created by Law 9.872/1999, provides guarantees for entrepreneurs lacking collateral and is funded by the Wage Guarantee Fund (FAT) and managed by Banco do Brasil. Because the bill passed under a conclusive procedure, it can proceed to the Senate unless a motion for plenary debate is filed.