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If, in the 2015-2016 crisis, the credit In the current crisis, this channel has widened. This has been possible because the two crises are of different natures: in the first case, the difficulties were built up slowly within the economy itself; in the second, they resulted from a health problem which now, with the final phase of the vaccines, tends to be resolved. Another interesting fact is that historically, after a pandemic, interest rates tend to fall and in the current case, due to the dynamics of communication and the globalization of markets, interest rates have already adjusted. See the interbank rates around the world that have generated economic stimulus and reduced fiscal debt services.

Faced with the shock of 2020, the actions of private credit providers and government actions were decisive in getting credit to the top, preventing the economic after-effects from being even greater. The result: according to the most recent data from the Central Bank, the nominal balance of credit operations rose by 14.5% in the comparison between October 2020 and the same month of the previous year.

For 2021, according to forecasts collected by Febraban, The nominal credit balance is expected to rise by 6.8%. If the projections are confirmed, there will be a reduction in the rate of advance of loans compared to 14.5%. The figures also suggest an increase in the default rate in 2021, which is expected to reach 4.3% of the free credit portfolio, in line with what we have already anticipated here.

The loss of momentum in credit and the rise in defaults should be put into perspective by the fact that 2020 was a totally atypical year. With the expected return to normality, it is natural that there will be some cooling in the appetite for and supply of resources. The projections also indicate a strengthening of credit to individuals, to the detriment of credit to legal entities, reversing the trend observed throughout this year.

Even with the less abundant supply of resources, the economic team believes that the credit market will be one of the engines of economic growth next year. For this reason, some measures to improve this market will remain on the agenda. One of the topics to be discussed in 2021 is expanding the possibilities of using guarantees when taking out loans, in order to provide more security for those granting them and make it possible to charge lower interest rates.

There is also talk of reducing bureaucracy at the time of contracting. Data from the credit bureau sector shows that, among the micro and small entrepreneurs who find it difficult to contract credit, 57% point to bureaucracy as one of the main barriers. In 2020, Provisional Measure 958 temporarily removed some bureaucratic requirements for contracting credit with public banks. Other measures to facilitate access to credit, without prejudice to proper risk analysis, deserve to be considered beyond this period of difficulty.

Finally, it's impossible to talk about the outlook for credit without remembering recent institutional advances. Some measures taken over the last few years are already beginning to bear fruit. The Positive Registry is a good example. Designed to reduce information asymmetry and thus ensure that more consumers have access to credit, the figures collected so far confirm the potential of this instrument.

The results presented by Midway, the financial arm of the Riachuelo retail chain, at the Global Retail Show 2020, revealed that the use of credit information from the Positive Registry made it possible to increase the company's credit approval rate by up to 10%, which corresponds to 120,000 new cards issued in one year. In addition, this information enabled better segmentation of customers eligible to take credit, reducing credit risk.

It should be noted that the adoption of the Positive Registry in credit assessment has been accelerated due to the pandemic. It is expected that, with all the positive data from sectors other than Financial Institutions, the impact on credit concessions and risk management will be even greater. The competitive vector also should be a trend for 2021 and for the future, through the growth of fintechs, the cultural changes of Brazilians, who are increasingly familiar with digitalization, and the promise of the Open Banking.

It was with the aim of contributing to improving the credit environment in Brazil that the National Association of Credit Bureaus (ANBC) actively participated in discussions on the credit market throughout 2020. I close by wishing everyone that, in the coming year, we will recover what was good about the old normal, but without forgetting what we have learned from what we have experienced.

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By: Elias Sfeir President of ANBC & Member of the Climate Council of the City of São Paulo & Certified Advisor