Brazil's government is studying a plan to buy up old household debts, according to O GLOBO, after roughly 30% of participants in the Desenrola debt renegotiation program fell back into default. The report was published Saturday and picked up by other Brazilian outlets.
O GLOBO reports that the proposal under review would involve public money being used to purchase longstanding debts owed by families, with the aim of reducing household indebtedness. UOL Economia reports that Durigan defended adjusting Bolsa Família and confirmed that a new Desenrola is under study.
According to Estadão, Durigan said the debt-purchase proposal would likely begin after the elections, in 2027. Gazeta do Povo and InfoMoney also reported on the government's interest in acquiring old debts to lower family debt levels.
The discussions center on what happens after a debt is renegotiated but the borrower still cannot keep up with payments. A 30% default rate within Desenrola suggests a significant share of participants were unable to sustain the terms they agreed to.
The reported proposal raises questions about cost and design, since buying debts with public funds would shift risk from creditors to the government. The outlets did not detail the size of any potential purchase or which debts would qualify.
What to watch next: whether the government formally announces the plan, how it would be funded, and whether it moves forward only after the 2026 elections as Durigan indicated.
