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Interest rate on state mortgage crediting may be reduced to 6 percent

The Prime Minister of Kyrgyzstan, Mukhammedkaly Abylgaziev, instructed to work out the issue of reducing the interest rate on state mortgage to 6 percent per annum. The Information Support Department of the Cabinet of Ministers reported.

The day before, the Prime Minister held a meeting on the activities of State Mortgage Company. Its Chairman of the Board, Baktybek Shamkeev, told that 3,118 families were provided with housing for more than 3.43 billion soms within the program «Affordable Housing 2015-2020.»

«Along with the provision of loans for the purchase of real estate, the company is building multifamily houses in Naryn and Bishkek. Upon completion of the construction, it is planned to lease the apartments for up to 15 years with their subsequent purchase,» Baktybek Shamkeev stressed.

At the same time, the main source of financing for mortgage lending is a budget loan of 2.8 billion soms. The minimum interest rate on loans of the State Mortgage Company today is 8-10 percent per annum. The sum is the budget loan provided at 2 percent, the services of commercial banks — 4 percent, and the operating expenses of the company — 2 percent.

Mukhammedkaly Abylgaziev was dissatisfied with the fact that the management of the State Mortgage Company and commercial banks earn on the socially oriented project.

«Our citizens are forced to give part of their wages for the loan. Most of them borrow money to improve their living conditions. At the same time, those, who have to provide every assistance in the implementation of this project and maximally simplify the conditions for obtaining a loan, think only of income. This is unacceptable,» the prime minister said.

We allocate money from the budget not in order to increase the profit of commercial banks and pay salaries to employees of the mortgage company.

Mukhammedkaly Abylgaziev

During the meeting, Mukhammedkaliy Abylgaziev instructed to work out the issue of reducing the mortgage loan interest rate to 6 percent per annum.