It seems like the era of “hyperbolic profits without much effort” has come to an end for Brazilian banks

Following the likes of Caixa, Banco do Brasil (BB), Santander and HSBC, the duo Bradesco and Itau reduced the interest rates of several types of credit and financing for individuals and corporations after Brazil’s government called for banks to reduce spreads to stimulate the lagging economy. All customers with bank accounts with both banks will finally start paying less for financial services related to auto loans and payroll credit. The new rates go into effect on Monday, April 23.

For instance, Bradesco will reduce its monthly fees on vehicle financing from 1.35% to 0.97% and personal credit from 2.66% to 1.97%. Itaú should offer similar discounts.

Banco do Brasil said on Wednesday that it had seen a jump in demand for its consumer and business credit lines since slashing interest rates earlier this month. The bank said there were signs its lower rates were drawing customers away from rival lenders, according to a press statement.

Brazil’s bank spreads, or the difference between what they pay out in interest to depositors and what they charge in interest on loans, are some of the world’s highest.

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