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Unbanked targets of credit cards: Study in Brazil by coalition partner IDEC shows that of the 40% of Brazilians without a bank account many are using store credit-cards that charge higher interest rates.

Brazil: 'bank accountless' cornered into expensive credit cards

17 Jan 2011

A new study shows that nearly 40% of Brazilians do not have bank accounts. Without any alternative, consumers use store credit-cards that charge higher interest rates.

Bank accountless

Although the number of bank accounts in Brazil nearly doubled between the years 2000 and 2008, the number of Brazilians 'bank accountless' still accounts for 39.5% of the population, according to research by the Institute of Applied Economic Research (IPEA). The results were released on 11 January 2011, and counted the Brazilian Institute of Consumer Defense (Idec) as one of its participants. The most critical situations occur in the Northeast (52.6% bank accountless) and North (50% bank accountless) of the country.

The study, 'Perception Indicator System (SIPS) on Banks: exclusion and services', also showed that credit supply is not seen by consumers as the primary function of banks:

  • 4.5% of the population believes that 'borrowing' is the main function of the bank
  • 62.1% sees it as 'moving or saving money'
  • 29.5% said 'offering products and services / paying bills'.

Social responsibility of banks

According to Idec, both banking exclusion and the distorted view of the true function of banks are detrimental to consumers.

'Without a bank account, people have no access to bank credit and only use the credit offered in retail chains such as department stores and store cards.'

'People on low-incomes are penalised by paying higher interest rates,' says the Executive Coordinator of Idec, Lisa Gunn. Moreover, 'the supply of credit in a responsible manner by banks should be one of its main functions to promote social development and economic development,' she adds.


Banking exclusion also leads many people to use the network of banking agents, such as lottery shops and supermarkets, to carry out some financial services.

'This method can not be seen as a way of promoting banking inclusion. For Idec this may worsen the situation for consumers, who already face difficulties in obtaining adequate and clear information within the bank and now have a more serious problem outside of it.'

Little financial education

As for the fact that only 4.5% of customers said that banks are there to lend money, according to Lisa Gunn, there is little knowledge about the financial system by the population, 'because most people do not know which banks are behind the financing of automobiles, appliances, clothing, and large retail chains in Brazil.'

Financial issues focus of consumer complaints

Lisa Gunn says it is necessary to consider the numerous consumer complaints presented to consumer protection body Procon. According to data from the National System of Consumer Protection (SINDEC), which brings together the complaints of various consumer protection organisations in Brazil, financial issues make up a large number of consumer complaints.


A survey by Idec in March 2010 found that many institutions do not comply with the Consumer Protection Code, decisions of the Central Bank and the Order of the SAC. Most industry complaints relate to services provided without request - such as sending credit cards - billing errors, not providing copies of contracts, a lack of information and long queues.

ID: 47510
Publication date: 02/02/11

IDEC - Instituto Brasileiro de Defesa do Consumidor (Council)

Created: 05/07/11. Last changed: 05/07/11.
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