Government to Launch Loan Larization Scheme
The Georgian National Bank and the government of Georgia will initiate the loan larization scheme from January 17th. The move was announced during the government meeting on January 11th.
The credit loan larization process is expected to decrease the dependency of the country’s population and its financial sector on foreign currencies, the US dollar in particular. During the meeting, Prime Minister of Georgia Giorgi Kvirikashvili made a formal address to the Minister of Finance, Dimitry Kumsishvili, asking him to begin detailed clarifications of the procedures for the planned larization process after the meeting’s completion.
According to current plans, this will affect clients who took out loans before January 1st 2015, whose income did not exceed 10,000 lari in that year, and whose remaining credit balance is not higher than $40,000. However, if the loan is already paid in full for the period from January 1st, 2015 to November 28th, 2016, the credit remaining for the period after that point will be subsidized by Georgian government.
“We’re providing commercial banks enough recourse both in national currency and in US dollars, so there will be no additional one needed in the process,” said Archil Mestvirishvili, Vice President of Georgian National Bank.
by Nino Gugunishvili