Delinquency is a persistent feature of Brazil’s economic landscape and directly reflects the financial health of consumers, companies, and the credit system itself. Recovery, a company of the Itaú Group and a specialist in credit recovery in Brazil, closed the first half of this year having renegotiated 4.3 million debts with more than 2.3 million individuals. These debts totaled over R$ 2.3 billion renegotiated.
“Brazilian debts reach us through the NPL (Non-Performing Loan) assignment market, which involves the sale of delinquent portfolios. Major sellers, such as banks, retailers, cooperatives, and other types of companies, negotiate their overdue portfolios, thus gaining liquidity and anticipating resources that could take many years to return to cash flow. All of this is done under regulation, following rules set by the Central Bank and the Securities and Exchange Commission (CVM),” explains Bruno Russo, CEO of Recovery.
According to the executive, the NPL market reached R$ 12 billion in portfolio sales volume in the first half of this year. “Compared to the same period in 2024, major banks saw a 6% increase in total portfolios sold. Additionally, other financial institutions, such as digital banks and cooperatives, experienced a 31% increase. This shows that besides the large traditional banks, other types of companies are increasingly turning to NPL assignment,” Bruno explains.
“Since 2019, the number of companies selling their overdue credit portfolios has risen from 15 to 46 annually, including institutions of different sizes and sectors. Although the NPL sale market in Brazil is still small compared to other countries, such as those in Europe, this growth in selling companies shows how much the market is expanding in Brazil. More and more companies see selling these credits as an alternative to manage delinquency. For debtors, this process also represents a new chance to renegotiate overdue accounts and restart their financial lives,” concludes the executive.
Original Story: Correio dos Municípios | Author: News
Edition and translation: Prime Yield