Banking and opening bank account in Brazil
Information on opening a Brazilian bank account – what documents to provide – the credit and debit cards, payment methods, cheques and more.
The Brazilian banking system offers a substantial range of services for both private individuals and companies. Banking rules are strictly enforced, and all banking business is closely monitored by the banks themselves and by the Central Bank of Brazil(Banco Central do Brasil).
In addition to the extensive branch network of the major retail banks, many of which have self-service ATM halls, most services available at the bank itself are also available via Internet banking.
Brazilian banks offer current accounts, savings and investment accounts, credit and debit card services, personal loans and overdrafts, and in some cases, foreign exchange services. Local banks will also set up standing orders, accept payment of utility bills and local, state and federal taxes. They also accept instalment payment books (carnê). Instalment books are issued in stores if a person doesn’t have a credit card and wishes to pay in several instalments. The instalments are payable either in the store itself or through the banking system.
Types of Account
Current accounts (conta corrente) usually entitle the account holder to a cheque book and/or debit card. These accounts are normally non interest-bearing.
Savings accounts(conta de poupança) pay monthly interest on average daily balances for the month. This rate is currently 0.5 percent over the basic reference rate, (Taxa Referencial – TR). Interest earned on these accounts is tax-free.
Today, many banks combine these two accounts into an investment account (conta de investimento). Deposits are automatically routed to the savings account, and transferred to the current account to cover cheques, debit card payments and cash withdrawals. These accounts are also used for investments in funds, with all investments and redemptions transiting through the account.
Overdrafts(cheque especial) in Brazil are normally by arrangement and subject to the proper credit analysis by the bank. Usually, on opening an account, the bank may make such a credit line available. Interest rates on such facilities are very high.
A cheaper alternative is the personal loan (empréstimo pessoal), repayable in up to 24 or 36 instalments, depending on the bank. Competition is strong and rates vary from bank to bank.
Opening a Bank Account
To open a retail bank account, the following documents are required:
- A valid identity document. In the case of a foreigner resident in Brazil, this will mean their foreigner’s identity card (Cédula de Identidade para Estrangeiro – CIE) which contains the Registro National De Estrangeiro (RNE)
- Individual Taxpayer’s number (Cadastro de Pessoa Física – CPF, also referred to as Cadastro Individual de Contribuintes – CIC)
- Proof of domicile (such as a utility bill in the name of the person opening the account)
To obtain the CPF, it is necessary to fill out the application form at any Post Office, branch of Banco do Brasil or branch of the Caixa Econômica Federal and present the documentation required (usually the original or a certified copy of the RNE). There is a small fee. The applicant will receive a counterfoil with a code number. Thereafter, the applicant will be notified to appear at a unit of the Federal Revenue Service and present their documents and the counterfoil in order to obtain their definitive CPF.
In addition, banks may ask for proof of earnings/income, where a salary payment account (conta salário) is to be opened. In this case a valid payslip is enough. The latter is commonly referred to in São Paulo as contra-cheque or hollerith, but local variations of the name exist around Brazil. A conta salário only differs from a normal current account in that the holder of the account may be entitled to a wider range of benefits, for example lower fees on banking transactions.
The bank may also request and verify personal and/or employer references, including valid telephone numbers. Additional information requested may include credit card and/or store card numbers and/or income tax declaration, at the bank’s discretion.
Some banks currently allow accounts to be provisionally opened online, with subsequent presentation of the necessary documentation at the branch of choice.
Using a Brazilian Bank Account
Payments in Brazil are often made with credit or debit cards. International credit cards are widely accepted, although local cash withdrawal services may be restricted in certain cases.
In spite of the high degree of banking automation in Brazil, and the possibility of paying most utility bills online, many Brazilians still pay their bills at the cashier in their local bank. Therefore, be prepared for large queues at cash tills.
Banking is not free in Brazil. Most banks charge a monthly all-in fee for basic services, including a cheque book containing 20 cheques. Depending on the chosen package of services and account balances, banks award points that can be used to defray charges.
Cheque books are still widely used, especially by companies, but are being increasingly replaced by debit cards, especially for retail purchases, since many stores simply no longer accept cheques. Issuing a cheque without sufficient funds is a crime, subject to severe administrative and legal sanctions.
In many bank branches there are cheque dispensers. These function like an ATM, but they issue cheques, usually in sheets containing four cheques and are for those who don’t need or want a conventional cheque book. Customers can print out as many cheques as they need, when they need them, subject to their arrangements with the bank. This cheques-on-demand option actually saves banks money that would otherwise be spent in the printing, storage and distribution of conventional cheque books. The number of cheques to which account holders are entitled will be predetermined in the monthly tariff negotiated with the bank.
Most banks are open Monday to Friday from 10:00 to 16:00.
The purchase and sale of foreign currency is still one of the most tightly controlled aspects of banking in Brazil. Purchase of foreign currency using a credit card is not permitted. Foreign visitors can normally sell foreign currency on presentation of a valid passport, especially at bank branches located in the major airports. Most bank branches generally only deal in foreign currency on behalf of their clients, and not all branches provide foreign exchange facilities. Foreign currency may also be exchanged at one of the many exchange bureaux (casas de câmbio). The maximum amount of foreign currency that can be brought through customs and into the country is the equivalent of 10,000 reais.
Non-resident foreigners in Brazil may hold local currency accounts in Brazil, subject to Heading 1, Chapter 13, Section 1 of the International Capital and Foreign Exchange Market Regulations (Regulamento do Mercado de Câmbio e Capitais Internacionais) of the Central Bank of Brazil.
Foreigners who are temporarily resident in Brazil can hold foreign currency accounts, subject to Heading 1, Chapter 14, Section 7 of the International Capital and Foreign Exchange Market Regulations (Regulamento do Mercado de Câmbio e Capitais Internacionais) of the Central Bank of Brazil.
Funds for investment are registered with the Central Bank of Brazil and in the case of investment funds, with the Brazilian Securities Commission (Comissão de Valores Mobiliários – CVM). In the case of funds entering Brazil in order to open a company, for example, the initial capital is registered with the Department for Foreign Capital and Control and Registration (Fiscalização e Registro de Capitais Estrangeiros – FIRCE). A certificate is issued, which entitles the company to remit future profits and/or dividends and, if necessary, repatriate capital.