Bank of Russia completes discussion of proposals on microfinance market development prospects for 2025–2027
Most participants in the discussion basically supported the need to stimulate the market of affordable loans for households and businesses. They also believe that microfinance organisations (MFOs) should eliminate negative practices that lead to households’ over-indebtedness.
Public consultations on the Bank of Russia’s paper regarding microfinance market development prospects for
After the consultations held, the Bank of Russia plans to prioritise the implementation of the measures to protect individuals proposed in the paper. Such measures include the introduction of the ‘one microloan to an individual until repayment’ principle and the establishment of a cooling-off period when an individual is allowed to obtain a new microloan no earlier than three days after he/she repaid the previous debt. Moreover, the regulator intends to reduce the maximum overpayment amount on consumer microloans from 130% to 100% of the debt amount.
The legislation and regulations will be comprehensively reviewed during three years. When developing the regulation, the Bank of Russia will take into account the proposals and comments received during the public consultations.