Kazakhstan’s financial regulator has clarified the conditions under which banks and microfinance organizations can issue loans to clients who set a voluntary borrowing ban via the “Stop-Credit” service.
The regulator recalled that with an active “Stop-Credit” freeze, a financial institution must deny a loan, but the law provides for exceptions. For bank loans, the ban does not apply to point-of-sale consumer installment loans, internal refinancing, revolving credit card limits of up to 648,750 tenge, and loans issued to pay taxes or fines. Microloans may be granted to pay for goods and services directly to the seller, for refinancing within the same organization, and for paying taxes. Pawnshop microloans are entirely exempt from the “Stop-Credit” freeze.
If a loan is issued in violation of the ban, the financial institution is required to write off the debt, correct the borrower’s credit history, and refund any collected funds.