From November 10, a new loan assessment criterion has come into force for companies and individual entrepreneurs engaged in sales on credit. Under the new rule, if the match between the data submitted to banks and the indicators held by credit bureaus is below 90 percent, the loan will be classed as a non-performing asset.
But how will the change affect entrepreneurs’ access to credit?
Speaking to Globalinfo.az, economist Eyyub Karimli said the change could have both positive and certain restrictive effects on entrepreneurs’ access to credit:
“First of all, banks will be able to assess entrepreneurs’ real financial position and credit risks more accurately. This will create conditions for greater transparency of accounting in the instalment sales market, a reduction in hidden debt obligations and stronger financial discipline. For example, if an entrepreneur’s instalment sales portfolio stands at 500 thousand manats while the data submitted to the credit bureau shows a significant discrepancy, the bank will have to reassess the reliability of that entrepreneur’s financial statements.”
The economist believes that in the short term this change could make it harder for some entrepreneurs to access financial resources:
“However, in the long term it could have a positive effect on the transparency of the instalment sales market, on reducing banks’ problem loan risks and on the formation of healthier credit relations.”
Zaira Akifgizi
Globalinfo.az
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