1. In 2021, with aim to protect the rights of borrowers, the Head of State signed the Law of the Republic of Kazakhstan "On Amendments and Additions to Some Legislative Acts of the Republic of Kazakhstan on the regulation of banking, microfinance and collection activities in the Republic of Kazakhstan", which introduced a single mandatory procedure for banks and microfinance organizations to settle overdue debts for citizens on all loans from October 1, 2021 and which provides for the adoption of measures to restructure loans at the stage of a borrower's delinquency.

In case of failure to reach agreement with a lender on the terms of loan restructuring, a borrower has the right to apply to the Agency of the Republic of Kazakhstan for Regulation and Development of Financial Markets (hereinafter: Agency).

An authorized body considers an appeal submitted by a borrower-individual upon presentation of evidence of his/her appeal to a bank (organization carrying out certain types of banking operations) and failure to reach a mutually acceptable decision on changing a mortgage agreement terms.

As a measure of mortgage borrowers protection, a lender does not have the right to begin procedures for the recovery of mortgaged property from debtors belonging to socially vulnerable segments of the population during consideration of an appeal by the Agency.

Thus, in order to enhance the protection of borrowers' rights at the legislative level, norms were adopted in 2021 prohibiting banks from foreclosing on mortgaged property without taking all measures within the framework of the debt settlement regime.

At the same time, in order to restore the access of citizens with a negative credit history to financial services, the Agency introduced the rehabilitation mechanism for borrowers who have a negative loan history due to outstanding problem debt and who are in need of its restructuring.

The mechanism provides for the possibility for a borrower to obtain the status of "rehabilitated" on loans, depending on the availability/absence of current overdue debt. For borrowers experiencing difficulties in repaying loans, individual work is provided by credit organizations to draw up a rehabilitation plan with a possible restructuring of the loan (deferral of loan payments, extension of the loan repayment period, reduction of the interest rate, cancellation of part of the debt, etc.) and generation of a more convenient repayment schedule based on the assessment of a borrower's solvency.

2. In order to protect the rights of pledgers when foreclosing on immovable property and to ensure transparency of collateral auctions, the Law "On Amendments and Additions to Some Legislative Acts of the Republic of Kazakhstan on Public Administration, Improvement of the Collateral Policy of Second-Tier Banks, Regulation of Assessment Activities and Enforcement Proceedings" No. 100-VII was adopted on December 31, 2021, which provides for:

- increasing the insignificance and overproportion criteria of overdue debt to the value of mortgaged property on mortgage lendings. Thus, the amount of the outstanding obligation has been increased from 10% to 15% and the delay period from 3 months to 6 months;

- a ban on the sale of housing at an undervalued auction, the threshold for reducing the sale price of collateral has been raised to 75% of the original estimated value, previously this threshold was 50%;

- unfair actions on the part of creditors are excluded by introducing a ban on participation in the auction of a creditor, its employees and affiliated persons;

- a bailiff obligation has been introduced to grant a debtor the right to independently sell the distrained immovable property (housing) within a 3-month period;

- termination of the mortgage in case of sale of the mortgaged immovable property under the mortgage housing loan agreement in court, if a debtor-individual does not have other property or income that can be foreclosed on, exceeding twice the minimum wage.

-the grounds for writing off blank debt after the implementation of the pledge were expanded. In case of sale of the mortgaged immovable property under the mortgage housing loan agreement in court, in the absence of other property or income that can be foreclosed on, exceeding 2 times the minimum wage, the remaining debt will be written off.