In a significant development for Brazilian social security beneficiaries, the Federal Court of Accounts (TCU) has given the green light for the resumption of new consigned personal loans linked to the National Social Security Institute (INSS). The decision, handed down by Minister Marcos Bemquerer, comes after the government filed an urgent appeal against a previous suspension.
The court's ruling specifically allows for the granting of new personal loans where repayments are automatically deducted from the beneficiary's payroll or pension. This type of credit is often a financial lifeline for retirees and public servants, offering lower interest rates due to the reduced risk for lenders.
However, the decision is not a complete reversal. The TCU has maintained the suspension on two other specific financial products: consigned credit cards and consigned benefit cards. These modalities will remain unavailable for new contracts until the court reaches a final decision on the merits of the case.
The government's appeal, which successfully argued for the resumption of personal loans, centered on the potential social and economic fallout of a prolonged ban. Officials contended that blocking this form of credit would force vulnerable citizens into more expensive and potentially dangerous financial alternatives.
According to the government's submission to the court, the suspension was pushing INSS beneficiaries toward higher-cost credit options, informal lending markets, or even situations of severe debt overload. The executive branch framed the consigned loan as a critical tool for financial stability and inclusion.
This interim ruling provides temporary relief while the full legal process continues. The TCU's final judgment on the legality and regulation of all consigned credit products for INSS beneficiaries is still pending. The outcome will have lasting implications for the financial options available to millions of Brazilians.
Based on reporting from g1.