Brazilian states tighten payroll loan rules for public servants

The government of Tocantins issued a decree expanding the terms for payroll‑deduced loans to state employees. Installments can now be spread over up to 120 months, with housing loans allowed up to 360 installments, and the regulation emphasizes greater transparency and financial education for civil servants.

In Mato Grosso, a new law designates Banco do Brasil as the only bank permitted to offer payroll‑deduced credit to state workers. The legislation caps income commitment at 35%, eliminates consigned credit‑card products and bars fintechs from the market. It also includes a recent court ruling that keeps monthly payroll deductions under judicial oversight to prevent unauthorized disbursements.