Everyone who wants to get a micro-loan must remember that the ability to repay a micro-loan is directly related to his income, and therefore to solvency.

According to the current legislation, a micro-loan cannot be obtained if payments on all loans of the borrower exceed 50 percent of his income.

How to take a micro-loan correctly and safely for your own budget, said the director of the Association of Microfinance Organizations of Kazakhstan Yerbol OMARKHANOV.

Before contacting an organization engaged in microfinance activities, that is, an MFO, a credit partnership, a pawnshop, study the five steps of checking a micro-loan "for correctness".

Step #1. Check the availability of a license from the organization where you want to get a micro-loan

Since January 1, 2021, all organizations engaged in microfinance activities (hereinafter referred to as microfinance organizations, MFOs) are located in the regulatory perimeter of the Agency for Regulation and Development of the Financial Market of the Republic of Kazakhstan (hereinafter referred to as the Agency).

As of July 1, 2022, the microfinance sector of the Republic of Kazakhstan is represented by 246 microfinance organizations that have the right to provide microloans to individuals on the basis of an appropriate license issued by the Agency. The Agency publishes a list of licensed organizations on its website www.gov.kz in the section "Registry of permissions and notifications". The license for the provision of micro-loans indicates that the organization is under the control of the financial regulator and conducts its activities in accordance with the legislation of the Republic of Kazakhstan on microfinance activities.

Therefore, in no case should you receive commodity installments or cash in the form of a loan from companies that do not have a corresponding license. The activities of such companies are illegal, interest and penalties under loan agreements concluded with such companies can reach unaffordable amounts that the consumer simply will not be able to pay in the future. Under the guise of microfinance organizations, fraudsters are hiding who have a psychological impact on citizens in order to lure out their personal and payment data for further processing of fake loans.

In order to counteract the issuance of fictitious microcredits, since May 2021, the Agency has tightened the procedure for identifying borrowers when issuing online microcredits. Now, in order to issue an online micro-loan, a microfinance organization is obliged to identify the client in one of three ways:

– by means of an electronic digital signature;

– by biometric identification of the borrower through the service of the Identification Data Exchange Center of the National Bank of the Republic of Kazakhstan;

– by two-factor verification of the borrower's personal data and image in real time.

Additionally, from January 2022, MFOs are required to verify the subscriber number specified by the client with the data of mobile operators.

And since January 16, 2022, in order to prevent fictitious debts from citizens and protect their interests from the actions of intruders, the Agency has introduced a procedure for settling debts on a micro-loan issued in a fraudulent way. Now, when a citizen applies to law enforcement agencies about the illegal registration of a micro-loan, the MFO is obliged to suspend the accrual of remuneration for a fictitious micro-loan within three calendar days and stop the claim-claim work on the client.

A memorandum of understanding and cooperation was signed between the Agency and law enforcement agencies to ensure strict and timely execution of the established procedure by MFIs. According to the memorandum, the Agency monitors the adoption of measures by MFOs to correct information in credit bureaus and write off debt when confirming the fact of a fictitious micro-loan.

Step #2. Read carefully the agreement on the provision of microcredit

It should be known that microfinance organizations are prohibited from charging borrowers any fees, as well as against the will of citizens to impose additional services that will be paid from the amount of the micro-loan.

In order to avoid a situation with deductions from the amount of microcredit money, before signing the contract, it is necessary to carefully read the information posted on the website of the microfinance organization. In the process of issuing a micro-loan, also carefully study the text of the micro-loan agreement.

The legislation imposes a requirement for the execution of contracts in order to exclude the cunning tricks of unscrupulous creditors using fine print for any bonded conditions. Thus, the micro-loan agreement should contain: general terms of the agreement; the rights of the borrower and the microfinance organization; restrictions for the microfinance organization; liability of the parties for breach of obligations; the procedure for making changes to the terms of the agreement; the repayment terms of the micro-loan; the amount of the remuneration rate and the GES. The requirements are also set:

– to the size of the paper (A4) on which the contract should be printed;

– the font of the text of the contract is "Times New Roman" with a size of at least 12, with the usual inter-letter, single line spacing and the use of paragraph indents.

The title page is the first sheet of the contract, which contains the terms, amount and term of the micro-loan, the remuneration rate, the GES, the amount of overpayment, the method and method of repayment, as well as the amount of the penalty (fine, penalty) for violation of obligations under the contract.

Most often, when filling out a questionnaire for obtaining a micro-loan for a borrower, checkboxes have already been ticked in the points according to which additional services are offered to the borrower, payment for which will be deducted from the amount of the micro-loan. In the future, this information will be reflected in the contract that you will be given to sign.

Step #3. Pay attention to the amount of remuneration

According to the Law of the Republic of Kazakhstan "On Microfinance activities", microfinance organizations have the right to provide 2 types of micro-loans, namely:

1) micro-credit to individuals and (or) legal entities with or without collateral in the amount not exceeding 20 thousand. MCI (monthly calculation index) established for the corresponding fiscal year by the law on the republican budget;

2) micro-loans to individuals in the amount of no more than 50 MCI, established for the corresponding year by the law on the republican budget, for a period of up to 45 calendar days.

The annual effective interest rate (ESR) for the first type of micro-loan cannot exceed 56 percent per year.

According to the law, the second type of microcredits is not subject to the requirement of the amount of the GESV of 56 percent, if the following conditions are met:

– remuneration under a micro–loan agreement concluded with an individual does not exceed 20 percent of the amount of the issued micro-loan - in cases of providing collateral for such a micro-loan, and 25 percent – for unsecured property. Thus, the value of remuneration for this type of microcredit is calculated in a simple arithmetic way;

– the amount of the penalty (fine, penalty) for violation of the obligation to refund the amount of the microcredit and (or) payment of remuneration under the contract may not exceed 0.5 percent of the amount of the unfulfilled obligation for each day of delay;

– all payments of the borrower under the agreement, including the amount of remuneration and penalties (fines, penalties), in aggregate cannot exceed the amount of the issued micro-loan for the entire period of validity of the micro-loan agreement;

– the contract contains a ban on increasing the amount of microcredit;

– by agreement of the parties, it is possible to extend the term of the agreement on the provision of microcredit on current or improving terms.

When receiving this type of micro-loan, it is important to remember that it is repaid not in parts, but in a lump sum payment.

Step #4. Study what the delay of payments on a micro-loan threatens for you

In particular, pay attention to the amount of the penalty for late fulfillment of obligations to repay the amount of the microcredit, which, according to microcredits of individuals who are not secured by a pledge of property, cannot exceed 0.5 percent of the amount of the unfulfilled obligation for each day of delay.

In case of delay, you should not hide from the microfinance organization. To protect the rights of borrowers experiencing difficulties with repayment of micro-loans, from October 1, 2021, a single procedure for settling overdue debts of citizens, mandatory for credit institutions, has been introduced by law.

To start the procedure of settlement of problem debts, you should apply to the creditor with the appropriate application. In the application, it is necessary to specify the full name, IIN, contact details, information about the microloan, the reasons for the delay with the attachment of the available supporting documents.

For the convenience of citizens, applications can be submitted both in writing and remotely, that is, without visiting the offices of the MFIs through official Internet resources and the lender's e-mail.

Within 15 calendar days from the date of receipt of the application and supporting documents, MFIs individually analyze the financial and social situation of the debtor. Within the specified period, you must be informed of the lender's consent to the restructuring of the loan.

With the consent of the lender under the terms of the loan restructuring, MFIs are obliged to make the necessary changes to the terms of the microcredit agreement within the next 15 calendar days with the adoption of a new loan repayment schedule.

Step #5. You have the right to apply to the financial regulator for protection of your rights

In case of failure to reach a mutually acceptable decision on changing the terms of the agreement, or if the MFO violated your rights and interests, you can contact the Agency of the Republic of Kazakhstan for Regulation and Development of the Financial Market, but with documents confirming the fact of applying to the MFO.

Based on your request, the Agency will initiate a documentary audit in relation to the microfinance organization, within the framework of which an analysis of the creditor's compliance with legal requirements for the settlement of problem debts will be carried out.

Postfactum.kz from Fingramota.kz