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Russia may reduce the term of consumer loans

Vice Speaker of the Federation Council Nikolai Zhuravlev and Chairman of the State Duma Committee on the Financial Market Anatoly Aksakov submitted to the State Duma a bill that would limit the maximum term for concluding an unsecured consumer loan to five years. It is reported by Izvestia.

It is noted that the law may come into force by the end of the year. At the same time, banks will be given six months to adapt to the new requirements.

According to the document, financial institutions will be required to offer the borrower an alternative loan option without purchasing additional services, to inform him of a change in the total cost of the loan when the contract is revised.

In addition, it is planned to include in the calculation of the full cost of the loan any payments in favor of the lender and (or) third parties. The changes should also affect the advertising of consumer loans. So, now it should not contain an indication of their cost as a percentage per annum, except for information about the full cost of the loan.

According to the authors of the bill, the innovations will increase the awareness and protection of citizens in consumer lending.

According to the National Credit Bureau (NBKI), slightly less than a third (30%) of borrowers have almost no chance of borrowing from banks due to the lowest personal or individual credit rating (PCR or ICR).

Below the average value (24.8%), the chances of approval of applications for citizens with an average rating are estimated. We are talking about 30% of borrowers. Another 30% of applicants, as follows from the data of the NBCH, have a high rating. At this level, they are approved by 44.9% of applications.

Russia may reduce the term of consumer loans