ArmInfo. Armenian authorities intend to stimulate the development of agricultural production by subsidizing interest rates. At a meeting on April 9, the Armenian government approved a program to subsidize interest rates on loans provided to the agri-food sector.
In his speech, RA Minister of Economy Gevorg Papoyan noted that various targeted programs are currently being implemented in the country to stimulate the development of the agricultural sector, including intensive orchards, livestock breeding, and so on. However, the program presented encompasses the entire agricultural sector. This program is primarily aimed at supporting small farms.
The program will be implemented in 2026-2027. Participants will include individuals and legal entities, sole proprietors, commercial banks, or credit institutions with an agricultural lending portfolio, as well as the Ministry of Economy of the Republic of Armenia. To participate in the Program, a beneficiary submits a program application to the financial institution to determine the allocation of loan funds. The loan agreement concluded between the financial institution and the beneficiary must include provisions stipulating that the financial institution will inform the beneficiary of the program requirements and the consequences of their violation, as well as the transfer of information about the beneficiary to the Ministry or another government agency within the program.
Loans are provided in drams through non-cash transactions. The loan limit for each beneficiary is 1-2 million drams, with the maximum loan amount provided to a single beneficiary not exceeding 2 million drams. No other fees (service fees, commission fees, etc.) are charged for the financial institution's services related to the loan. Each beneficiary must obtain a loan from only one financial institution within the maximum loan amount. The loan is provided at an annual interest rate of up to 14%, with interest rate subsidies provided to bring the borrower's annual interest rate to 0%. The loan repayment term is set at up to 3 years. A mandatory grace period of 6 months from the loan disbursement date is provided for repaying the principal and interest (the first payment on the principal and interest will be made after 6 months). After the adoption of the project, loans totaling approximately 40 billion drams are planned for disbursement in 2026, with approximately 2 billion drams required for subsidizing these loans in 2026.
