The National Bank of the Kyrgyz Republic has issued a warning about the risks of transferring funds to entities that lack a license to accept deposits.
The National Bank pointed out that taking deposits is a banking operation that can only be conducted under an appropriate license. Commercial banks, microfinance companies, housing finance companies, and credit unions are authorized to take deposits, strictly within the scope set out in their National Bank license.
The regulator advised caution whenever several warning signs appear: the lack of a deposit-taking license, promises of above-market returns, aggressive fundraising through social media and advertisements without risk disclosures, vague contract terms, and a lack of information on how the raised funds are used or where the promised returns come from.
The National Bank noted that systematically raising funds from the general public without a proper license may constitute illegal banking activity and carries liability under Kyrgyz legislation.