Banco do Brasil and Caixa to handle collections in Desenrola 3.0

The Brazilian government plans to have Banco do Brasil and Caixa Econômica Federal take charge of debt collection under Desenrola 3.0. The measure is part of the initial outline for the new program designed to ease household debt. The final operational format remains subject to technical discussions between the government, banks, and other creditors.

Under Desenrola 3.0, the federal government aims to clear up to BRL 150 billion in household debts. The plan involves acquiring bank and non-bank debt portfolios of up to BRL 10,000 that have been in default for two to four and a half years. The administration proposes buying these debts from creditors with a minimum discount of 90% and passing that discount on to borrowers.

The initial proposal entails setting up a credit rights investment fund (FIDC) in which the National Treasury would be the sole shareholder to purchase the portfolios. Following the acquisition, Banco do Brasil and Caixa would leverage their operational expertise to manage collection efforts. Borrowers will enter the program automatically if their debt is purchased, with options to settle the remaining balance in cash or in instalments with interest.

The government schedule anticipates issuing the auction call in November and collecting bids in December. Winning bids are expected to be approved in January, followed by contract signings with creditors and debtor refinancings starting in February.