Savings accounts have another record outflow in August

Brazilians withdrew BRL 22 billion (USD 4.19 billion) more than what they deposited into savings accounts in August, the largest monthly net outflow on record — dating back to 1995. Until then, the largest outflow from savings accounts in the country came in January this year, when withdrawals exceeded deposits by BRL 19.66 billion.

The August numbers only show the continuation of a trend seen in recent months. In the first eight months of the year, Brazilians’ withdrawals were BRL 85.16 billion higher than deposits, a record mark since 2015. 

Savings accounts remain Brazil’s leading investment platform and are a reliable gauge of families’ financial health. Recent numbers show that falling wages and rising consumer prices are forcing Brazilians to take money out of their savings to make ends meet. 

In addition, withdrawals come at a time of rising bank interest rates — the highest in four years, having reached 39 percent in June — and household indebtedness.

A survey by the National Confederation of Commerce (CNC) released this week shows that the number of indebted people in Brazil reached 79 percent of total households in August, up 1 percentage point from the previous month. In the year, the bump was 6.1 percentage points. 

And according to data from credit protection company Serasa Experian, in July, 67.6 million Brazilians were in default — a record since the beginning of the survey in 2016.