Default rate increases by 6.72% in SP: 85% of consumers are repeat offenders

Abstract Default rates in São Paulo grew by 6.72% in May, with 85% of consumers repeating their debts, while credit recovery fell by 13.56%, causing concern for the retail sector due to the continued increase in debt and the decline in consumption.

The number of defaulters in São Paulo grew 6.72% in May, compared to the same period last year, according to a survey by SPC Brasil in partnership with FCDL-SP (Federation of Chambers of Retail Managers of the State of São Paulo). The increase was above the average for the Southeast region (4.74%) and the national average (6.28%).

Furthermore, 85.08% of the negative entries registered in the state were from repeat offenders, that is, people who had already been included in the defaulters' register at least once in the last 12 months - a slight drop of 0.04%. Within this group, 64.65% still have previous debts outstanding and 20.43% returned to debt after paying off their debts.

“Defaults are increasing at a rapid pace and the recurrence shows that a significant portion of the population is trapped in a cycle of continuous debt. This limits consumption, hinders access to credit and requires caution from retailers, who are already feeling the effects of the decline in sales,” says Maurício Stainoff, president of FCDL-SP.

The survey also shows that credit recovery in São Paulo fell 13.56% in May, compared to the same month in 2024 - a sharper decline than that recorded in the national average of 11.92%.

The age group with the highest reoffending rate continues to be 30 to 39 years old, with 26.96% of cases. The distribution by gender also remains balanced: 54.17% women and 45.83% men among repeat offenders. In addition, the total amount of outstanding debts in the state grew 13.28% in 12 months, once again exceeding the national average of 11.15%. Each defaulter in São Paulo accumulates, on average, two outstanding accounts.

“The increasing difficulty families have in settling their debts is a warning sign for the retail sector. Lower recovery means less access to credit, lower consumption and greater risk to the sustainability of companies in the short and medium term,” highlights Stainoff.

The average amount spent by consumers to get out of debt was R$2,423.05 - with 53.47% paying debts of up to R$500.

Banks accounted for 73.16% of debts, maintaining the lead among creditor sectors. Next came water and electricity bills (9.99%), other services (8.57%), commerce (3.57%) and communication (4.70%).

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