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Parliament reduces loan rates for pawnshops to 29.83 percent per annum

The Parliament of Kyrgyzstan in the third reading approved a bill setting the maximum rate at which pawnshops can give loans.

Initially, the Ministry of Economy and Commerce proposed setting the maximum rate at 47 percent per annum. Minister Daniyar Amangeldiev said: if the rate is set lower than the proposed one, then pawnshops may go into the shadows.

Despite this, deputies reduced the maximum rate to 29.83 percent per annum by the third reading.

According to deputy Dastan Bekeshev, if the bill is signed by the president and the amendments come into force, as the State Service for Regulation and Supervision over the Financial Market, approximately 50 percent of pawnshops in the country may close.

«There will remain desperate people in the market, who, according to my calculations, will be able to maintain a pawnshop with a turnover of 15 million soms and at least 1,000 clients. This turnover will give an average of $1,000 income for the pawnshop owner after paying taxes, maintenance of two employees, paying rent, utilities and small expenses,» MP Dastan Bekeshev posted on Telegram.