On January 2nd, 2020, a Banks’ “Do Not Disturb” system will be available in Brazil. This system will allow consumers to register all telephone numbers related to their social security number to block unwanted calls offering payday loans; thus preventing an abusive advertising practice and enabling its tracking.
The 23 institutions responsible for 98% of the country’s payday loans – including, among others, Santander, Itaú, and Bradesco - have adhered to the bank self-regulation that creates rules for offering this type of loan. Under the new rules, the industry associations will track the complaints against banks, building a database combined with complaints made directly to the banks, the Brazilian Central Bank, Procon (Foundation for the Protection and Consumer's Defense), and legal authorities. There will be a link available on the institutions’ websites for requesting the “Do Not Disturb” and the data will be available on the Febraban (Brazilian Bank Federation) and ABBC (Brazilian Bank Association) websites - the first results shall be released in February.
Based on the complaints, correspondent banks may be punished with warnings or the definitive suspension of the activity. There are also penalties planned for banks, which can reach 1 million reais (approximately 300,000 dollars). Furthermore, a regulation by National Consumers Secretariat (Senacon, a department of the Ministry of Justice) will come into force establishing clear sanctions for non-compliance with the bank sector’s self-regulation and enforcing the Consumer Defense Code’s general rules.
The amount of complaints on payday loans to Procon from January to November, 2019, was 20% higher than in the 12 months of 2018. Following the Normative Instruction No. 100 - issued by the Brazilian National Institute of Social Welfare (INSS) in December 2018, prohibiting the offering of loans to newly retired people during the period of six months -, the “Do Not Disturb” system aims to stop the abusive advertising of payday loans and the over-indebtedness it causes.