The editorial office of receives alarms that during the last 2 months some banks operating in Armenia refuse to provide consumer loans based on credit history. It should be noted that based on the credit history, banks and credit organizations make the following decisions:
- To provide a loan or not?
- How much loan to provide?
- Under what conditions the money should be provided?
If in the past financial institutions made the decision to provide a loan based on salary, today the emphasis is on credit history.
Iravaban․net tried to find out from the Central Bank what the legal approach of such banks towards borrowers is.
According to Article 11 of the RA Law on Banks and Banking Activities, banks operating in the territory of the Republic of Armenia are vested the right to operate independently, and the Central Bank is prohibited from interfering in the current activities of banks and other persons licensed by it..
“Based on the above, we inform that the banks make their decisions on providing loans on their own, based on the regulations defined by their internal legal acts, and taking into account the risks associated with the return of the loan by a particular customer, as well as the degree to which a person is burdened with credit obligations, the amount of income, and other circumstances or factors. Based on the above, we would like to note that the fact that the organization refuses to provide a loan does not rule out the possibility of receiving a loan from another lending organization,” the Central Bank said in a statement.
In addition, the Central Bank also states that its intervention is limited to the use or application of the powers defined by the legislation of the Republic of Armenia. “For example, by measures taken as a supervisory body in accordance with the RA legislation (including in case of violation of any requirement of the RA legislation by means of liability) or by establishing a mandatory requirement for a financial organization, which are mostly aimed at curbing the risk of banks’ activities. They do not regulate the mandatory requirements for lending to any person.
