BAKU, Azerbaijan, March 3
Trend:
The MPs of Kazakhstan’s Parliament approved the bill ‘On Amendments and Additions to Certain Legislative Acts of Kazakhstan on the Regulation of Microfinance and Collection Activities in Kazakhstan’ in the second reading, Trend reports with reference to the Kazakh media.
At the plenary session of the Parliament, the MPs noted that the mentioned bill was submitted to the Kazakh Parliament on September 15, 2020.
The bill was developed in accordance with the decree of the president of Kazakhstan dated June 26, 2019 No. 34 ‘On measures to reduce the debt burden of citizens of Kazakhstan’ and the instruction of the Head of State, given at an expanded meeting of the Government on January 24, 2020.
The purpose of the bill is to strengthen the protection of the rights of consumers of financial services. The amendments by the MPs aimed at:
- preventing the growth of lending risks and excessive growth of the debt burden of citizens;
- improving the mechanism for regulating disputes, strengthening the rights of debtors;
- suppression of bad faith actions of collectors, as well as strengthening the protection of debtors' rights.
To increase the efficiency of the mechanism of pre-trial settlement of problem debts on bank loans and microcredits of citizens, it is envisaged:
- a unified legal regime for the settlement of overdue debt of citizens on loans, which applies not only to bank loans, but also loans to microfinance organizations (MFOs);
- reduction (from 180 to 90 days) the terms of consideration of borrowers' applications by creditors and settlement of problem debts;
- approval by a regulatory legal act of the authorized body of the conditions and procedure for debt settlement.
To prevent an increase in risks in lending and an excessive increase in the debt burden of citizens on loans (not related to the implementation of entrepreneurial activity), the amendments provide:
- a ban on banks and MFOs to accrue remuneration on capitalized overdue remuneration (forfeit, fines, penalties, commissions);
- limiting the amount of penalties (fines, penalties) for microcredits, as well as a ban on the accrual of remuneration and commissions after 180 days of delay for all types of mortgage loans;
- write-off of blank balances on mortgage housing loans remaining after the sale of mortgaged housing, borrowers with incomes not exceeding the minimum wage;
- monitoring of advertising of financial organizations.
To limit risks in the field of microcredit, prevent fraudulent activities and exceed the marginal rates of remuneration, the following is introduced:
- banks and MFOs must submit to the credit bureau information on nominal rates and the effective annual rate of remuneration, as well as the obligation of the state credit bureau to submit this information to the regulator for supervisory purposes;
- MFOs must indicate the effective annual rate of remuneration when distributing and placing advertisements;
- MFOs must notify the agency and the financial monitoring body of the state registration as a microfinance organization.
Moreover, in order to prevent an increase in the debt burden of citizens due to restructuring or refinancing of microcredit, in which the remuneration is summed up to the principal debt, it is proposed to prohibit the capitalization (summation) of overdue remuneration, penalties (fines, penalties), commissions and other payments related to the issuance and servicing of a loan, to the amount of the principal debt.
In the conclusion of the Finance and Budget Committee, it is noted that the draft law establishes the requirements for the minimum size of the formed authorized capital of collection agencies. The minimum amount of the authorized capital of a collection agency will be established by the regulatory legal act of the authorized body.
To prevent unfair actions of collection organizations, it is proposed:
- to introduce a ban on collectors to interact with other people's phone numbers;
- to establish the obligation of video and audio recording of the process of interaction with debtors;
- to limit the interaction of the collector with third parties