The Agency of the Republic of Kazakhstan for Regulation and Development of the Financial Market
How is debt write-off (forgiveness) carried out?
The Agency is not authorized to directly interfere in the operations of financial organizations regarding debt write-offs, forgiveness, or deferrals, as financial institutions independently determine their credit policies.
It is important to note that when reviewing requests related to the provision of a preferential loan repayment schedule, partial or full waiver of penalties and fines, or resolving issues with loan repayment, financial organizations make decisions based on their internal policies, taking an individual approach to each borrower’s specific circumstances.
Since October 1, 2021, pursuant to Article 36 of the Law on Banks and Banking Activities and Article 9-2 of the Law on Microfinance Activities, a unified and mandatory procedure for banks and microfinance organizations (hereinafter – creditors) has been introduced for the settlement of overdue debts of citizens on loans and microloans. This procedure requires creditors to review the borrower’s request for loan restructuring based on their current payment capacity.
Therefore, borrowers experiencing difficulties in repaying their debts have the right to contact their creditors—where the loan was issued—with a written request for loan restructuring, along with supporting documents confirming their current financial and social situation.
If such documents and information are not provided, financial institutions will not be able to consider the request for debt settlement.
In addition, borrowers may apply for out-of-court or court bankruptcy, or for restoration of solvency, in accordance with the Law of the Republic of Kazakhstan “On Restoring Solvency and Bankruptcy of Citizens of the Republic of Kazakhstan.”
The out-of-court bankruptcy procedure applies only to debtors seeking to discharge their obligations to second-tier banks, organizations engaged in certain banking operations, microfinance organizations, or collection agencies.
Detailed information on the out-of-court bankruptcy procedure is available at the website.
The competent authority for this process is the Ministry of Finance of the Republic of Kazakhstan.
What mistakes do borrowers most commonly make when taking out a mortgage?
The most common mistakes include underestimating one’s financial capabilities, focusing solely on the amount of the monthly payment without considering the total cost of the loan and the overall amount of interest paid, and overlooking additional expenses associated with purchasi...
What additional expenses, apart from the monthly payment, should be taken into account when purchasing a home with a mortgage?
When purchasing a home with a mortgage, it is important to consider not only the monthly loan payment but also additional expenses associated with acquiring and maintaining the property. These may include property appraisal costs, insurance, notarial and registration fees, taxes,...
Can a borrower lose their home due to a prolonged mortgage delinquency? What is the foreclosure procedure?
In the event of a prolonged failure to fulfill obligations under a mortgage loan, the legislation provides for the possibility of foreclosure on the mortgaged property. However, before such measures are taken, borrowers are provided with a number of tools to settle their debt. In...
What are the “gray” and “black” lists of droppers?
To combat dropper schemes, a centralized system for recording suspicious clients has been established. The system is operated by the Anti-Fraud Center of the National Bank, which receives information from banks, payment organizations, telecommunications operators, and law enforce...
What new requirements have been introduced for the remote issuance and reissuance of bank cards?
For the remote issuance and reissuance of bank cards, financial institutions are required to use two-factor authentication, including biometric identification. Bank cards may only be linked to Kazakhstan-registered mobile phone numbers, which reduces the risk of using foreign SIM...
What is “dropping” and what penalties are provided by law?
“Dropping” refers to the illegal provision, transfer, or use of access to a bank account, payment instrument, or identification tool, as well as the execution of unauthorized payments or money transfers, including on behalf of third parties, in exchange for financial compensation...
How has the regulator strengthened its oversight of collection agencies in recent years?
Since 2017, the Agency has pursued a regulatory policy aimed at strengthening oversight of collection activities, improving the functioning of the debt collection market, and reducing unfair collection practices. Since 2017, the following regulatory measures have been introduced:...
Does a debtor have the right to record a conversation with a collector?
Yes. Under subparagraph 7) of paragraph 1 of Article 16 of the Law on Collection Activities, a debtor and/or their representative has the right to independently record interactions with employees of a collection agency using audio and/or video recording equipment.
