With the decree of President Ilham Aliyev on additional measures for addressing problem loans of natural persons in Azerbaijan, questions arose among citizens about the application of benefits and the compensation mechanism, along with a number of other aspects. Economist Vugar Bayramov brought some clarity to a number of issues, Trend reports.
1. Will the compensation be provided to the citizens who took loans before the devaluation and paid them off without delays?
The compensations are meant to be provided for exemplary borrowers. For example, a citizen took out a $10,000 loan before February 21, 2015 and, despite two devaluations, could not repay the loan. According to the decree, the resulting difference will be calculated in accordance with the approved mechanism, and this amount will be paid to the person who has already repaid their loan.
2. Are the persons currently paying a loan on a monthly basis obliged to continue their payments?
Once the decree is passed, loan payments will also be calculated and a compensation will be provided. From this point of view, there are no problems in continuing the payment of loans: citizens will receive compensation for these funds.
3. Do the benefits apply only to loans taken in US dollars?
Benefits apply to loans taken both in dollars and in manats, the national currency. A citizen of Azerbaijan who has taken a loan of up to 17,000 manats will also be able to enjoy this benefit.
4. If the amount of compensation paid on a loan is several times larger than the size of the loan after devaluation, how will a citizen be compensated?
In this case, a bank account will be opened for the citizen, and funds will be transferred to the account, from which the citizen will be able to withdraw their money.
5. In which cases will the funds be paid to the bank, and in which cases to the citizen?
The compensation will be calculated, and additional funds remaining after the repayment of the debt will be paid to the citizen. For example, the compensation that will be paid to a citizen after the assessment of the debt is $4,000. The citizen has a debt in the amount of $1,000. In this case, $3,000 are paid out of the citizen’s bank account, and the citizen is to repay their loan with the remaining $1,000.
6. Will the benefits apply to loans taken in euros or rubles?
Benefits will apply to any foreign currency in an amount not exceeding $10,000. Thus, persons who have taken a loan in rubles will be able to enjoy the benefit as well.
7. Will compensation be paid to citizens of Azerbaijan who have taken a loan from non-bank credit organizations?
Citizens of Azerbaijan who receive loans from all types of credit institutions will be able to enjoy these benefits.
8. Will persons with remaining credit debts be able to repay them after payment of compensation?
For example, the balance on a citizen’s loan after the assessment is $6,000, and the compensation is $4,000. In this case, the remaining loan debt is $2,000. This debt is changed to manats - in this case, the remaining debt amounts to 3,400 manats. An interest-free loan for 1 year is provided to the citizen for the payment of this debt, along with another loan for 5 years at a 1 percent rate. A new payment schedule is drawn up, and monthly payments are significantly reduced. This basically means that the interest on the remaining debt is not calculated, and the loan period is extended so that the citizen can make the payment.
9. What is the time frame for preparing a list of citizens and defining the size of compensations?
According to the decree, the list of natural persons and the amount of funds provided, which will be paid to each natural person, will be defined within 45 days. This means that all citizens will be informed of the amount of compensations they receive by late April at most.
10. When will citizens be able to get compensations?
According to the decree, the latest date for payment of compensations is May 28.
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