AMD 209mln allocated from Armenia`s state budget for repayment of bad  loans 

ArmInfo.  209 million drams will be allocated from the state treasury of Armenia to ensure the continuity of the measure to stimulate the economic activity of citizens with problem loans for April and May 2025. The decision was made by the Cabinet of Ministers on April 23 at a regular meeting. Currently, 3,594 people out of 9,630 applications have been recognized as  beneficiaries of the program.

As stated in the explanation to the document, within the framework of the measure determined by the decision, support will be provided to individual borrowers, all of whose loans are classified as non- performing (NPL) for 3 or more years, and the amount of the principal obligation does not exceed 1 million drams or the equivalent in foreign currency.

Within the framework of this measure, the beneficiary is provided with financial support in the amount of 100% of the income tax calculated from the beneficiary's salary and equivalent payments (income received under a civil law contract), which is used to pay off the bad credit obligation. Support is provided for a maximum period of 24 months, starting from the 1st day of the month following the month in which the beneficiary is recognized, but not more than until the bad credit debt is fully repaid, support is terminated on  the basis established by the decision, or the obligation is  terminated on the basis established by law.  Potential beneficiaries of the program are 218 thousand people, with overdue debt of 168 billion drams.  According to the Ministry of Labor and Social Affairs, only 20% of the list of potential beneficiaries are officially employed, that is, only 43,600 people. The application deadline is set from February 1, 2025 to January 31, 2026.

It is noted that the implementation of the event requires financial resources for about 3,000 beneficiaries in the first quarter of 2025 (only March was paid in the first quarter) in the amount of 121.5 million drams.

In February 2025, 1,896 persons were recognized as beneficiaries of the program, and from the amount of 121.5 million drams allocated by the Decree of the Government of the Republic of Armenia dated March 6, 2025, about 70,625.0 thousand drams were allocated to repay their loan obligations in March 2025 (support is provided from the 1st day of the month following the month of recognition of the beneficiary). The amount allocated per 1 beneficiary was 37,249 drams. Accordingly, the remaining amount of the allocated amount is 50,875.0 thousand drams.

The amount required to repay the loan obligations of 1,896  beneficiaries who received support in March 2025 (with applications in February) for April and May 2025 is 141,250.0 thousand drams. At the same time, during March 2025, 1,072 persons were recognized as beneficiaries based on applications and are to be provided support  within the framework of the event from April 2025. The amount of funds required to repay the loan obligations of these beneficiaries for April and May 2025 is about 62,810.0 thousand drams.

During the implementation of the event, it is also expected that  about 1,500 new people will become beneficiaries of the event during April 2025, starting from May 2025. And the amount of money required to repay their credit obligations for May 2025 will be about 55 million drams.

In addition, it is planned to amend the legislation in April,  according to which persons whose data are defined by law as limited will be able to become beneficiaries.

Thus, the amount of funding required to repay the credit obligations of the beneficiaries of the event for April and May 2025 is approximately 209,032 thousand drams, taking into account the balance of 50,875.0 thousand drams.

, the document says.

According to the Central Bank, as of October 1, 2024, the number of borrowers with a bad credit history is about 341 thousand, and their total credit burden is 642 billion drams. As of April 2023, this figure was at the level of 525 billion drams.