Amount of fines and penalties for premature repayment of loans in Armenia to be reviewed

ArmInfo. In Armenia, it is  necessary to develop mechanisms that encourage bona fide borrowers.  Corresponding instructions to the head of the Central Bank were  announced by the Prime Minister of Armenia Karen Karapetyan on April  27 at a meeting of the Government.

According to the prime minister, the current legislation allows banks  and credit institutions in the event of early repayment of a loan  against debtors - individuals or legal entities - to apply fines and  penalties. Such an approach, in spite of possible advantages, in the  opinion of the head of government, simultaneously creates  unreasonable difficulties for citizens of the country and economic  entities. "It is more logical to create mechanisms that will  encourage bona fide borrowers," he said, noting that complaints about  such penalties reached the government apparatus.

The head of the Central Bank of Armenia Artur Javadyan said that a  project has already been developed that provides restrictions related  to the imposition of fines and penalties. The document was submitted  to the parliament of the country and passed two readings. Karapetyan  urged Javadyan to accelerate the process and together with Government  to submit proposals to the Government for regulation of relations  between creditors and borrowers.

To note, during the meeting of February 7, the Parliament of Armenia,  considered the project on law on ?Housing mortgage lending? in the  package of corresponding laws.