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Cases analyzed by the Court of Justice of Mato Grosso do Sul show that earning well is not always a guarantee of financial balance when payroll loan debts accumulate over the years
Receiving a salary of R$ 14,000 per month is, for most Brazilians, synonymous with financial stability. However, for a military police officer in Campo Grande, this amount became a cause for concern, not tranquility. The officer turned to the court after realizing that almost 80% of his monthly earnings were committed to paying payroll loans, leaving only R$ 2,900 for his subsistence.
According to the court case, the debt was incurred with eight different financial institutions, including Banco Master, totaling R$ 531,000. The case is just one example in a growing list of public servants who turn to the so-called Over-indebtedness Law to try to rebalance their finances. The information was published on June 25, 2026, by the portal Campo Grande News, in a report by journalist Lucia Morel.
How the Over-indebtedness Law works and what it guarantees to public servants
According to the analyzed case, the request was filed in June of last year by the state servant himself, who claimed to be in a scenario of consolidated over-indebtedness. In the action, he requests that payroll deductions do not exceed the maximum limit of 35% of his income — a percentage provided by Federal Law No. 14.181/2021, created precisely to prevent and address situations of excessive indebtedness among consumers.
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This legislation, which amended the Consumer Defense Code and the Elderly Statute, acts as a legal protection for people who cannot honor their debts without compromising their own and their family’s basic sustenance. However, to access this benefit, the consumer must meet some specific criteria: be an individual, prove good faith in contracting the debts, and demonstrate that the total installments threaten the so-called existential minimum — currently set at R$ 600 per month for basic expenses.
In this sense, the law covers debts originating from consumer relations, such as loans, installment plans, and credit cards. On the other hand, housing debts, contracts with real guarantees, and debts of a fiscal or alimentary nature are excluded from this type of legal protection — in addition to situations where the indebtedness was voluntarily or fraudulently caused by the consumer himself.
Other cases reveal the same pattern: high salaries do not shield against over-indebtedness
The case of the military police officer is not isolated. In another case also pending in the Mato Grosso do Sul court, initiated in August 2024, a resident of Campo Grande accumulates R$ 206,000 in credit card and loan debts with four financial institutions. The installments compromise 59% of the consumer’s entire salary, which is R$ 7,400 per month. So far, neither of the two cases has had a preliminary decision or ruling authorizing the renegotiation of the debts.
The situation, however, is different from that recorded in a case from February of last year, involving a retired municipal employee who receives R$ 13,000 per month. Being over 65 years old, his case was given priority, and the ruling was issued in March of the same year — denying the request for rescheduling. The decision was upheld in the second instance by the Court of Justice, even with the retiree claiming to have loans with nine different banks.
According to the history presented in the case, the elderly man’s net monthly income is R$ 9,300 after mandatory deductions, with R$ 6,500 allocated to debt payments, leaving R$ 2,700 for his subsistence. However, the court did not accept the defense’s arguments, as a 2022 decree establishes that the existential minimum for over-indebtedness purposes cannot be less than R$ 600 per month — an amount that, in the retiree’s case, was already exceeded by more than four times.
Even so, the volume of cases related to the topic is noteworthy. Since 2023, the Mato Grosso do Sul Court of Justice has received 2,408 cases on over-indebtedness, most of them filed just last year. Of the total distributed, 1,602 cases have already been judged in the first or second instance, according to official data from the National Justice Council.
In light of this scenario, consumer law specialists reinforce a recurring warning: having a high salary does not guarantee financial security by itself. Therefore, more than the amount received monthly, what truly determines the balance of accounts is how credit is contracted and managed over time — especially when payroll loans accumulate silently until they compromise most of the worker’s income.
