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By Lise Alves, Senior Contributing Reporter

SÃO PAULO, BRAZIL –More than 59 million people in Brazil were in debt at the end of July due to high unemployment rates and economic difficulties faced by Brazilian households, according to data from a survey produced by the Credit Protection Service (SPC Brasil) and the National Confederation of Shopkeepers (CNDL).

Brazil,More than half of consumers in Brazil are unable to pay off their loans, says study,
More than half of consumers in Brazil are unable to pay off their loans, says study, photo by Tânia Rêgo/ABr

The number represents 39.3 percent of the population between 18 and 95 years and according to officials even with the expected recovery in the economy, the number of debtors should continue high in coming months.

“Assuming that the economy and consumption will recover slowly and gradually, the estimate should still fluctuate around 59 million negatives over the next few months without showing any significant progress,” stated CNDL President Honorio Pinheiro in a note after the release of the data.

The good news, however, says Pinheiro, is that the greater restriction of credit and falling consumption by households, caused by the crisis itself, acts to limit the growth of defaults.

According to the survey, the highest frequency of default debts occurs in the age group between 30 and 39 years old. In June, half of that population (50.11 percent or 17.1 million people) had their name included in credit protection.

The data also shows that the region with the highest number of people in debt is the Southeast, with 25.6 million consumers with their finances in negative territory, representing 39.06 percent of the adult population in the region. The region is followed by the Northeast (15.7 million), the South (7.8 million) and the North (5.3 million).

The study reveals that the segment with the most debt is the retail segment, followed by communications, water and electricity and banks.

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