Brazil bounced checks rise to six-year high as consumers struggle with recession

miércoles 21 de octubre de 2015 10:07 GYT
 

SAO PAULO Oct 21 (Reuters) - Bounced checks in Brazil climbed in the first nine months of 2015 to the highest in six years, as rising borrowing costs, the fastest inflation in over a decade and a steep recession made it harder for consumers to stay current, credit research firm Serasa Experian said on Wednesday.

The rate of bounced checks rose to 2.19 percent of cleared checks in the January-to-September period, compared with 2.07 percent a year earlier, Serasa said in a report. On a monthly basis, the rate climbed from 2.21 percent in September, the highest for that month since at least 1991, Serasa said.

Brazil's economy is expected to shrink this year and next, the first back-to-back annual contractions since the 1930s and domestic interest rates are among the world's highest. That has made it harder for factories, farmers and individuals to repay loans, driving up delinquencies, unpaid utility bills and bounced checks.

According to Serasa, households across the country are grappling with accelerating inflation - which is nearing 10 percent for the past 12 months - and large job losses, testing the ability of consumers to keep up with their financial obligations. (Reporting by Guillermo Parra-Bernal; Editing by Frances Kerry)