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Credit and Microcredit



Microcredit for Growth

Portfolio of payroll deductible loans reaches R$ 221.8 billion

A request of trade unions, agreed to by the Lula administration, payroll deductible loans — whose installments are withheld directly from the individual's paycheck — helped expand access to credit for employees and social security beneficiaries and reduce the interest rates charged for these operations. In December 2013 the total volume of payroll loans totaled R$ 221.8 billion (R$ 17.9 billion for private sector workers, R$ 137.1 billion for public servants and R$ 66.7 billion for INSS pensioners). This represented an increase of 103% over the same period in 2008, according to Central Bank data released by Dieese.

Learn more about the credit policy of the Lula and Dilma administrations

Retirees and pensioners are among major beneficiaries

The number of payroll deductible loans to retirees and pensioners of the INSS system, which mainly benefit the poor, jumped from R$ 30.7 billion in December 2008 to R$ 66.7 in December 2013, an increase of 117%. With the facilities offered by payroll loans, plus the policy of raising the real value of the minimum wage and free drugs for diabetes, hypertension and asthma, in addition to a discount of up to 90% on another 115 items available in the People's Pharmacy, retirees and pensioners got some help for their pocketbooks and a better quality of life. In the governments preceding Lula and Dilma, the opposite happened: the retirement and pension benefits were much lower, because there was no concrete policy of raising the real value of the minimum wage; neither were free drugs available for the elderly, one of the items that weighs most heavily on retirees and pensioners.

Learn more about the People's Pharmacy program.

Rural credit and development strengthens small farmers' crops

The R$ 2.2 billion that only few farmers, concentrated in the South region of the country, had access to in 2002 turned into R$ 24.1 billion for the 2014/2015 crop year, available throughout Brazil. With more Pronaf credit- as well as expansion of the service network, acquisition of food programs, Light for All, Water for All, etc. - millions of families could plant and harvest safely, profitably selling their harvest to market and strengthening their roots with their native regions in the countryside. Migration from the countryside to the city declines more every day. To combat the effects of drought in the Northeast, the worst in decades, the Dilma government created the Semi-Arid Harvest Plan, allocating R$ 7 billion to agriculture in the region. This was in addition to a monthly benefit of R$ 80 - the Drought Benefit - for 1.3 million farmers temporarily prevented from producing due to the extremely dry conditions.

Learn more about the federal government's support for family farming..

Of the 287,000 farming families benefiting from technical assistance programs through the Brazil Without Poverty Plan, about 60,000 are already receiving funds from the Rural Productive Activities Development Program. This consists of R$ 2,400 per family, divided into three installments, repayable to finance the implementation of productive infrastructure projects drawn up by technicians. The money can be used to buy seedlings, seeds, fertilizers, tools and animals, or go to pay non-agricultural activities such as a sewing workshop, provided that it generates income for the beneficiary families.