Daniel Girola, vice president-senior analyst, and Ceres Lisboa, associate managing director, both in the Financial Institutions Group for Latin America at Moody’s Ratings: “The measure to expand payroll-deductible loans for private-sector workers aims to stimulate economic activity by providing banks with well-structured and secured consumer loans that have high business potential. While this product is expected to offer lower interest rates compared to unsecured personal loans—which could help alleviate existing debt burdens—this measure comes at a time of high interest rates and inflationary pressures that are likely to continue affecting borrowers’ repayment capacity. We expect both large incumbent banks and digital banks to leverage their customer bases to offer the new product. In particular, digital banks that currently have minimal or nonexistent shares in private payroll loans due to a lack of relationships with large companies will find greater growth potential in the new centralized model. Penetration into the large, addressable market of private-company employees is likely to happen gradually as banks refine their credit models and…”