Assessing Indebtedness: Results from Pilot Survey among Steelworkers in Sao Paulo

This report summarizes findings from a study on indebtedness conducted in April-May 2006. The study sought to assess levels of over-indebtedness in the sample population and determine if there are any characteristics associated with people who are over-indebted.

The study surveyed the Steelworkers Union of the ABC region of São Paulo. The survey found that indebtedness is a problem for 15% of the sample. Findings include:

• No correlation is observed between socio-economic profiles and level of indebtedness;
• Certain forms of financial use are correlated with high levels of indebtedness;
• Payroll credit is used to liquidate more expensive debts;
• Vehicles are a source of financial stress;
• Bad credit record does not imply indebtedness.

The study recommends the development of a financial education program that would be group-based, historically grounded, family-oriented and objective-oriented in order to address indebtedness among the sample population.