The top margin on effective interest rate will decrease to 50% from 100%, Minister of Finance of Georgia Mamuka Bakhtadze said.
Previously, it was widespread practice that interest rates indicated in loan agreements did not reflect the reality, he added.
“Various commission fees, fines were added to the loan and this factor was doubling and tripling interest rates. Borrowers should know in advance how much percent they will have to pay. The top margin should be determined definitely and the 100% top margin should decrease.
We remind you that this top margin did not exist before January 1, 2018 and top margin used to hit even 300%-400%. International financial institutions think the same and I also believe that we are able to halve this top margin. All other aspects will be dictated by market trends”, Mamuka Bakhtadze noted.