The Third Panel of the Superior Court of Justice (STJ) ruled that loan agreements entered into by illiterate individuals through self-service terminals, such as ATMs, are invalid when the legal formalities required by law are not observed.
In the case under review, the Court held that the use of a bank card and personal identification number (PIN), as well as the receipt of the loan proceeds, do not replace the formal requirements established under Article 595 of the Brazilian Civil Code for the validity of private contracts executed by illiterate individuals. These requirements include execution by proxy signature (“signature at the request of the party”) and the signatures of witnesses, safeguards intended to ensure that the individual’s expression of intent is valid and properly documented.
The decision reinforces that, although digital contracting plays an important role in simplifying processes and expanding access to financial services, it does not eliminate the obligation to comply with specific legal safeguards, particularly in situations involving consumers in vulnerable circumstances.
For financial institutions, fintech companies, banking correspondents, digital lending platforms, and other businesses offering digital contracting channels, the ruling highlights the need to carefully design customer acceptance, validation, and documentation procedures.
From a practical standpoint, the decision indicates that the use of passwords, biometric authentication, security tokens, electronic confirmations, or self-service terminals may not be sufficient in every circumstance. Whenever the law requires additional formalities, organizations must implement appropriate mechanisms to ensure accessibility, informed consent, and the legal validity of the contractual relationship.
This scenario calls for a review of internal processes, particularly for products contracted through unassisted digital channels. Companies should assess whether their systems are capable of identifying customers in vulnerable situations, redirecting them to appropriate service channels when necessary, and preserving reliable evidence demonstrating the regularity and validity of the contracting process.
Organizations should also strengthen audit trails, customer service records, accessibility policies, assisted confirmation procedures, contractual documentation, and internal controls designed to prevent contract invalidity and future litigation.
The decision demonstrates that digital transformation in the financial sector must evolve alongside legal certainty, consumer protection, and effective risk governance. Technological efficiency cannot replace compliance with mandatory legal formalities, particularly where the validity of a person’s consent depends on specific statutory requirements.
