Banks restore lending in national currency
By Nigar Abbasova
Banks of Azerbaijan have restored consumer credit issuance in national currency by applying certain changes and restrictions.
In accordance with the information provided by Azerbaijan Banks Association certain banks have already launched credit issuance while others are joining the process gradually. Procedures for borrowing from banks has been toughened in accordance with the changes.
In compliance with the requirements laid down by the Financial Market Supervisory Body certain restrictions will be applied in reference to allocating credits. The changes envisage decrease of age limit for providing loan. Banks are eligible to issue credits only for individuals under 60 years should the credit issued for the first time, while previous age limit was 71 years, Milli.az reports. Lending to individuals who has not reached the age of 20 years is also prohibited.
To appeal for loan to the bank it is necessary to produce a list of documents, which include confirmation of working service, minimum term of which was increased in accordance with the applied changes. Minimum term of service for credit is currently 1 year while previous limit was 6 months. Age limit for recurrent credit acquisition is 65 years while minimum term of service is 6 months. Minimum salary for credit issuance in both cases should amount to 410 manats ($275). Credit period may range from 3 to 24 month while loan amount is 300-5,000 manats ($202 -3,356)
In accordance with the law in effect banks are eligible to determine the currency of the issued credit and free to choose in which currency to lend. Vulnerability in the currency market caused certain problems and prevented banks to issue manat loans.
Financial Market Supervisory Body aims at diagnosis and improvement of the management and regulation mechanisms of the financial market of the country. Main objective is to license, regulate and control the securities market, funds, insurance, credit organizations (banks, non-banking credit organizations) and provide transparency and quickness in this sphere.
Currently, 37 banks and more than 700 bank branches operate in Azerbaijan. Six banks of the country were closed since the beginning of 2016.
--
Nigar Abbasova is AzerNews’ staff journalist, follow her on Twitter: @nigyar_abbasova
Follow us on Twitter @AzerNewsAz