The Central Bank began to fight the misuse of consumer loans

The Bank of Russia has begun to combat situations where individual entrepreneurs take out a consumer loan for business purposes, which makes such loans more risky. About it reported Kommersant with reference to a letter from the National Council of the Financial Market (NCFM) sent to the Central Bank.

The NSFR noted that territorial divisions “impose excessive requirements on credit organizations” when they require banks to “create additional reserves” for non-targeted consumer loans. They clarified that such a requirement is made when banks cannot tell what the consumer spent the loan funds on.

According to the head of the NSFR, Andrei Emelin, the law provides for control over the expenditure of funds only in relation to those loans that were issued for specific purposes. Despite this, as the Central Bank divisions note, “the lack of information about the actual use of the loan, the borrower’s refusal to provide information or the inability to obtain it should be taken into account when forming a reserve as an increased risk factor,” the letter says.

The Central Bank explained that obtaining a consumer loan involves using funds for purposes that are not related to business activities. “Such a loan should be used exclusively for personal, household purposes; if the loan is actually taken for personal needs, then the level of risk on it, as a rule, can be predicted quite well,” the Central Bank noted.

According to data Frank RG analytical agency, at the end of September this year, the volume of loans issued to individuals amounted to 1.73 trillion rubles, which is 4.04% lower compared to August 2023 and 53.9% more than September 2022 d. The volume of non-targeted loans decreased the most (-21.9% compared to August).