1% a day: in Russia came into force new restrictions on loans

Не больше 1% в день: в России вступили в силу новые ограничения по кредитам

July 1, entered into force on rules of issuing of microcredits by the Central Bank (CB) of Russia. On Monday, July 1, reports channel “MIR 24”.

Under the new rules, the daily interest rate is capped at 1%, which will affect the activities of microfinance institutions (MFIs). Payday loans will be unprofitable. Total accrued interest and penalties on consumer credit agreement or a loan of up to one year will not exceed the debt more than doubled.

In the regulation of MFIs the most significant will be the introduction of increased debt load to prevent the growth of debt load of the population. So, decrease the maximum size of payments which the creditor may demand from the borrower, up to double of the loan amount.

27 December President of Russia Vladimir Putin signed a law limiting the maximum amount of debt on consumer loans. Total amount of interest and penalties on the loan, the repayment period which does not exceed one year, will be limited in stages.

In particular, if the loan is obtained after the law came into force, the maximum amount of debt until July 2019, cannot exceed the amount of the loan is more than 2.5 times, until January 2020, twice, and then in half. The interest rate on such loans must not exceed 1.5% per day, from July 2019 – 1%.