Redesign of Consignment Credit: Impacts on the Economy and Consumers

On May 4, 2026, Presidential Decree 1.355 came into effect, reshaping the landscape of consigned credit in Brazil. This regulation establishes a gradual schedule for reducing the margin reserved for this type of credit, from 5% currently to zero by 2029. These changes impact both businesses and consumers, with significant implications for the financial market dynamics and personal finances of workers. The reduction in reserved margins could lead to higher financing costs for those dependent on these products, which may have broader economic impacts, particularly on retail and low-income service sectors. Additionally, the decree also modified the distribution of payroll discounts, imposing stricter limits on new contracts. There remains uncertainty about the ultimate fate of these financial products, as the Decree depends on being converted into law and could be subject to adjustments during its legislative process.