Commentary to Decree No. 325 of 30 June 2014

    Belarusian President Aleksandr Lukashenko signed Decree No. 325 “On the raising and provision of loans, the operation of microfinance organizations” on 30 June 2014.

    The decree envisages the improvement of the procedure to regularly raise and provide loans, creation of conditions for the promotion of entrepreneurship and business initiative via the introduction of additional financing instruments. The decree aims to protect consumers of services provided by microfinance organizations.

    Starting from 1 January 2015, these services will be provided only by microfinance organizations, namely pawnshops, consumer cooperative societies for financial assistance, the association of mutual financing of SMEs, funds.

    Consumer microloans for physical bodies will be provided only by pawnshops. These loans will be secured by movable property. If a microloan is not paid back the security will be sold.

    Microloans for business promotion will be provided by microfinance organizations, except pawnshops, to the owners of assets, founders and members of commercial organizations, craftsmen, private farmers, people working in agricultural and ecological tourism, SMEs.

    The microloan will not exceed 15,000 basic rates.

    Consumer cooperative societies for financial assistance can be established by physical bodies who can get microloans for the development of business initiatives in accordance with the decree. Thus, a consumer cooperative society for financial assistance will be a voluntary association of craftsmen, farmers, people working in agricultural and ecological tourism, property owners, founders and members of commercial organizations who will provide microloans to each other.

    Companies that provide microloans shall be included in the register of microfinance organizations of the National Bank.

    Apart from that, the decree will protect consumers of services (physical bodies) provided by microfinance organizations. In particular, the National Bank will supervise the operation of microfinance organizations.