Government to Launch Loan Larization Scheme

The Georgian National Bank and the government of Georgia will initiate the loan Larization scheme from January 17 in a move announced during the government meeting on January 11.

The credit loan Larization process is expected to decrease the dependency of the country’s population and its financial sector on foreign currencies, the US dollar in particular. During the meeting, Prime Minister of Georgia Giorgi Kvirikashvili made a formal address to the Minister of Finance, Dimitry Kumsishvili, asking him to begin detailed clarifications of the procedures for the planned Larization process after the completion of the meeting.

According to current plans, this will affect clients who took out loans before January 1, 2015, whose income did not exceed 10,000 Lari that year, and whose remaining credit balance is not higher than $40,000. However, if the loan is already paid in full for the period from January 1, 2015 to November 28, 2016, the credit remaining for the period after that point will be subsidized by the Georgian government.

“We’re providing commercial banks enough resources both in national currency and in US dollars so no additions will be needed in the process,” said Archil Mestvirishvili, Vice President of the Georgian National Bank.

Nino Gugunishvili