Payroll Loans and Debt Among Public Servants in Brazil

This paper analyzed the effect of sociodemographic variables on the probability of indebtedness of public servants, focusing on the contracting of payroll loans by NEDF servants in the period from 2013 to 2019. Our main contributions to the literature were the use of hard-to-access database, consisting of information obtained from official systems of the Brazilian federal government and the addition of a new variable, alimony deduction, not previously considered by the literature. Our main conclusions are that older individuals, with a greater number of dependents, with higher real income and who pay alimony are more likely to have taken out a loan. Females, on the other hand, are less likely to have taken out a loan. Marital status can also affect this probability, with committed individuals with a higher chance of contracting a loan compared to single individuals.