By Kate Rintoul, Contributing Reporter
RIO DE JANEIRO, BRAZIL — While some small businesses are struggling as Brazil’s economy falters, one of the country’s biggest banks, Bradesco has launched a credit package of up to R$10 billion for new loans to their small and medium business customers. The program has been put in place after records for lending in June of this year showed that the bank had one of the lowest growth rates in its sector.
Speaking to O Globo, Altair Antônio de Souza, the bank’s executive director said, “We believe that demand in the second half will be more heated. Traditionally this is what happens.”
“We expect the credit of companies grow between 9 to 13 percent. We believe that the segment of small and medium enterprises can stay within this range”, said Souza, explaining that Bradesco classifies small and medium-sized companies as those with revenues between R$30 to R$250 million a year.
The new funds can be used for restocking, payment of staff and working capital. The credit package has the launch of a new line, Compor Estoque Fácil, in which the first repayment can be made in January 2015.
According to Souza, this will help small and medium size companies who want to increase their inventories for end of year sales, but who often sell in installments and therefore need a flexible payment plan. Under the new service, the release of credit is made direct to the supplier after company owners deliver the customer receipt of purchase to the bank and the interest rate is a minimum of 1.72 percent per month, payable over thirteen months.
Souza went on to explains, that despite this release of funds, increased limits available for each small and medium business remains subject to analysis, which may require additional collateral.
Read more (in Portuguese).
* The Rio Times Daily Updates feature is offered to help keep you up-to-date with important news as it happens.