Changes implemented in the support program for persons with non-performing loans
The Government of the Republic of Armenia (RA) has introduced amendments to the program aimed at stimulating the economic activity of individuals with non-performing (bad) loans. As a result of these changes, employees of the Penitentiary Service of the Ministry of Justice will also be eligible to benefit from the program.
Furthermore, if any beneficiary failed to receive support previously due to technical errors, there is now an opportunity to restore that support.
The decision also proposes to stipulate that overpaid support amounts directed toward the repayment of a beneficiary’s loan obligations—resulting from technical lapses during data exchange between information databases prior to this decision’s entry into force—are not subject to reimbursement to the state budget by the lenders.
The deadline for submitting applications has been extended until December 31, 2026.
Within the framework of the measure, support is provided to individual borrowers whose loans have all been classified as “non-performing” for three or more years, provided that the principal debt obligation does not exceed one million AMD.
According to data from the Central Bank, as of October 1, 2024, the number of individual borrowers with non-performing loans stands at approximately 341,000. Their total credit burden amounts to around 642 billion AMD (compared to 525 billion AMD in April 2023). Notably, only up to 20% of these individuals have formal employment; the remainder are either unemployed or engaged in informal employment. The monthly salary of 76% of them is below 150,000 AMD, while 60% earn less than the minimum wage, with an average salary of approximately 145,000 AMD.