On Tuesday, March 25, 2025, the Conselho Nacional de Previdência Social (CNPS) approved a new interest rate ceiling for payroll loans available to retirees and pensioners of the Instituto Nacional do Seguro Social (INSS). The limit has been raised to 1.85% per month, a slight increase from the 1.8% that had been in effect since the beginning of January 2025.
This adjustment is significant as it directly impacts how INSS beneficiaries access payroll loans, necessitating a closer look at the evolving economic landscape.
The primary justification for this increase in the interest rate ceiling is the recent rise in the Selic Rate, which has jumped from 12.25% to 14.25% per year since January 2025. The government noted that banks had ceased offering payroll loans under the previous limit, citing economic infeasibility.
Initially, the government proposed a ceiling of 1.88% per month, but this was adjusted to 1.85% to accommodate the interests of the Confederação Nacional do Comércio (CNC).
With this new ceiling in place, public financial institutions such as Banco do Brasil and Caixa Econômica Federal are expected to resume or continue granting payroll loans to INSS retirees and pensioners. Previously, these institutions had paused their offerings as their interest rates were already above the former limit of 1.8% per month. Now, with the adjustment, these operations can be resumed more broadly.
Despite the approval of the measure—passing with a majority of 12 votes to 1—the representative from the banking sector expressed dissatisfaction with the modest increase. He argued that the ceiling of 1.85% still falls short of the realities of the financial market, which is advocating for a ceiling of 1.99% to facilitate a full resumption of payroll loans.
This disconnect between the new interest rate ceiling and the current market conditions may lead to further discussions in the future. The impact of the rising Selic Rate on the availability of payroll loans has been a significant factor in this decision.
The cycle of increasing Selic rates began in September 2023. During a period of declining Selic rates, the government had previously reduced the limits on payroll loans for INSS beneficiaries. However, the recent uptick in basic interest rates has altered the landscape, leading several banks to suspend the offering of payroll loans by the end of 2024.
With the implementation of the new ceiling, access to credit is expected to improve for retirees and pensioners. The federal government published the resolution in the Diário Oficial da União (DOU) on Friday, March 28, 2025, formalizing the increase in the maximum interest rate for payroll loans granted to INSS beneficiaries.
For transactions conducted via payroll credit cards and benefit payroll cards, the ceiling remains at 2.46% per month. The increase was ratified at the 311th ordinary meeting of the CNPS, which took place on March 25, 2025. Alongside this decision, the CNPS has revoked Resolution No. 1,367 from January 9, 2025, which had set higher limits.
This new regulation is set to take effect five working days after its publication, promising to provide more controlled rates and financial predictability for INSS beneficiaries who utilize this form of credit.
Minister of Social Security, Carlos Lupi, had previously advocated for maintaining the limit on payroll loans for retirees and pensioners at 1.8% per month. His position was based on a study from the ministry indicating that there was no need for an increase in the ceiling.
The CNPS is composed of 12 members, with half from the Ministry of Social Security, three representing retirees and pensioners, and three from employers and workers. Earlier in the year, the council had raised the interest rate from 1.66% to 1.8% per month, reflecting the ongoing adjustments in response to the fluctuating economic conditions.
As the landscape of credit availability continues to evolve, the implications of these changes will likely be closely monitored by both beneficiaries and financial institutions alike. The balance between providing accessible credit to retirees while ensuring financial viability for banks remains a critical discussion point.
In summary, the recent decision by the CNPS to increase the ceiling for payroll loan interest rates marks a pivotal moment for INSS retirees and pensioners. While it aims to restore access to credit, it also reveals the ongoing challenges posed by rising interest rates and the need for alignment between government policy and market realities.
