Brazilian Association of Credit Bureaus (ANBC), an affiliate member of ACCIS from Brazil, recently issued an open letter urging the President of Brazil to revamp the Brazilian credit information system and to introduce rues to encourage participation in the existing information recording system. According to the ANBC, a proper ‘Credit History’ system could offer 0.54% extra of GDP growth, a $1.1 trillion injection to the market, and up to 45% reduction in loan delinquency in Brazil.
ANBC reminds that while Brazil is currently experiencing the biggest economic crisis in its recent history, over 63 million Brazilians ended up on the defaulters list, leading to higher interest rates and further economic hardship.
Part of the solution according to ANBC should be credit expansion based on a more thorough assessment of consumers’ credit history. Responsible credit, granted on the basis of true creditworthiness, is an important driver of economy, and the improvement of creditworthiness assessment and consumers’ financial literacy and access to information would all be crucial to reignite economic growth while avoiding the traps of overindebtedness.
To read the full open letter in English click here.