The Ministry of Labour and Social Protection of the Population of the Republic of Kazakhstan approved the rules of subsidized microlending for young people in accordance with the Address of the Head of State as of September 1, 2022 "Fair state. One nation. Prosperous society." Loans will be issued through a trustee (agent): Agrarian Credit Corporation JSC.

Agrarian Credit Corporation JSC acts as a trustee (agent) within the framework of the microlending program for young people and implements the functions of accepting documents, evaluating a business project, preparing loan and collateral agreements, transferring the loan amount to a borrower, verifying the intended use of a loan, monitoring collateral, making settlements with borrowers, accepting payments from borrowers, working with overdue debts and submitting reports to the authorized bodies.

Target group: citizens of the Republic of Kazakhstan aged 21 to 35 years, registered as individual entrepreneurs, whose registration period as an individual entrepreneur with the tax authorities in accordance with the tax legislation of the Republic of Kazakhstan at the time of applying for a microlending should be less than five years.

Loan conditions:

Loan amount is up to KZT 5 million

Interest rate is 2.5% per annum

Loan term is up to 7 years for livestock breeding, up to 5 years for other business areas

Concession period for repayment of a principal debt and remuneration is no more than one–third from the duration of a microlending.

A prerequisite is the availability of collateral. Movable (specialized equipment) and immovable property are accepted as collateral.

Microlendings are issued for any purpose, except for the following:

1. Acquisition, construction or repair of residential real property (including temporary/permanent dwellings for livestock breeders), acquisition of land plots (with any purpose).
2. Acquisition of securities (portfolio investments).
3. Production or acquisition of weapons (including components for production of weapons), narcotic substances or other property withdrawn from civil circulation.
4. Organization and (or) development of gambling business.
5. Activities related to terrorism and any other activity prohibited by the legislation of the Republic of Kazakhstan.
6. Production of excisable goods/products, except for projects involving production of motor vehicles and production of wine from grapes of own production.
7. Purchase of tobacco and/or alcohol products.
8. Repayment of accounts payable.
9. Personal consumer goals that are not related to running a business.

Decision to issue a microlending is made by a commission established under Akimat, which will include deputies of maslikhats, representatives of government agencies, Atameken, non-state organizations, business community and media.  Applicants will present their business project at a meeting of the commission, which will evaluate business projects and select the most promising ones.

Thus, the decision to grant a microlending is made by a commission based on clear criteria for assessing the thoroughness of applicants' business projects. A project should be relevant, substantiated, economically feasible, socially significant and viable, with a clear action plan.

More information about the conditions of microlending program for the youth is available on the website: agrocredit.kz.

Source: Agrarian Credit Corporation JSC