With high interest rates, companies exchange consortium financing debts; it is worth it?

The, very popular in the purchase of vehicles or real estate, has been gaining ground even among companies that resort to the tool to pay off debt and reduce installments. With the basic interest rate paused by 15%, companies are redoing calculations and seeking strategies to keep accounts up to date at lower costs. This output may even be a good alternative for some cases, but attention and planning is needed.

According to Cléber Gomes, CEO and partner -founder of Mastery, a company specializing in consortium and financial products, this movement has been growing since the beginning of the year. In July alone, when the company traded R $ 150 million in credit among its business partners, R $ 55 million was specific credit for debt exchange – representing 36% of the total.

According to the Brazilian Association of Consortium Administrators (ABAC), about 18% of consortium participants are legal entities. The advance is pulled by sectors such as transportation, construction, agribusiness and services, where companies have used the credit contemplated to replace more costly debts with interest without interest.

Strategy demands planning

The characteristic of the consortium is to allow the individual or legal entity that adheres to the system to have access to the contracted credit by paying lower rates than those practiced at the most traditional financing. The main difference between the two options is the cost and time of access to the feature.

In financing, the amount is released after the signing of the contract. Costs involve fees and interest. In the consortium, the amount is released after being awarded in a draw, bid or at the end of the contracted deadline. Costs do not involve interest, only administration and correction rate.

Therefore, companies that need the appeal immediately tend to resort to financing or bank loan. Those who can plan can join the consortium to buy real estate, trucks, among others. There are still those who are halfway – have a debt, but plan to exchange for the consortium and get rid of interest.

“If a company took a loan of $ 1 million and gave the warranty property, it will pay about $ 22,000 per month of installment. If she takes a consortium in the same amount and is contemplated by bid or draw, she will pay this debt of $ 1 million and exchange for a portion of $ 6,000 consortium,” he says.

In this example, it takes attention to the transitional period, since for a while it will be necessary to bear the two installments – the financing and that of the consortium.

According to Gomes, companies that are adhering to this mechanism are planning with focus and long -term strategy. “For companies with more stable cash flow, it is still possible to use the bid as a strategic tool: using part of the capital to anticipate contemplation and accelerate debt exchange,” says Gomes.

Jeff Patzlaff, CFP Financial Planner and investment specialist, says this alternative attracts entrepreneurs at the lower initial cost. “Imagine a company with a $ 200,000 financing debt at a rate of 1.8% per month, which generates a very high final cost over 48 months. If it can access a consortium letter of the same value, with a management rate of 0.2% per month and bid with the company’s own resources, the total cost can be significantly lower,” he explains. But is it worth it?

“In order to be worth it, it depends on many factors: the contemplation happens at the right time, the correction rate does not go up too much – and the entrepreneur ends up losing money – and that the company is financially prepared to endure this transition. In the end, you can do, but it is not simple, nor is it for any business profile. It is a strategy that needs to be well planned, with financial advice and a lot of clarity about the risks involved.

Cash correction and flow require attention

For Patzlaff, the first point of attention is the correction of the letter of credit and the installments. Although the consortium’s installments are not interest, an administration fee on them – sometimes a reserve fund – and the monetary correction factor, which can weigh a lot, depending on the scenario.

This index varies according to the good, according to the financial planner. In the case of a vehicle consortium, for example, the value of the letter of credit usually follows the appreciation of a reference model in the market. “This means that if the good acquired devalue while the index used by the consortium rises, the letter will not follow the real value of the acquired good, but the reference,” he explains.

Also, when a company thinks about changing a financing debt, such as a machinery for example, for a consortium, it needs to understand that it is not a direct and immediate replacement.

“The consortium, unlike financing, does not deliver the feature instantly, it depends on draw or bid. So the company needs to first enter the group, start paying and wait for contemplation, and many companies suggest the built -in bid that increases the chances of being contemplated, but increases its cost as the correction is made on the total contracted and not the balance you will have received.”

In such cases, a 50% bid in the letter amount doubles the cost of correction, which would make most consortia make up compared to financing in the assessment of Jeff Patzlaff.

Between entering the consortium and actually access to the letter of credit, one can spend a considerable period, depending on the group, the administrator and the value of the bids offered. According to Patzlaff, this period may vary from a few months to years. And while the consortium does not leave, the entrepreneur will have to bear two expenses: the provision of current financing and that of the consortium.

“Depending on the administrator and the group, a well -done bidding strategy can help anticipate contemplation, but this requires extra resources and a very careful reading of cash flow. With the delinquency of the still high companies and the most difficult credit, this overlap can compromise the financial health of the business,” he warns.

This strategy is not yet widely used by companies precisely because it requires a higher level of knowledge and financial maturity.

“It is not enough to account for the amount of the installment versus the consortium, it is necessary to consider the value of the bid, the impact on cash flow during the overlap period and the uncertainty of when, in fact, the letter of credit will be released,” he explains.