Business Sector on NDI Report – A Responsible Business Appreciates the Voice of Society, but the System is Vitally Important

According to a survey conducted by the National Democratic Institute (NDI), 49% of respondents find the new banking regulations enforced in January 2019 acceptable. 

In response to the question of whether they find new regulations reasonable in that they oblige loan-issuing companies to request a solvency proof, and restrict the size of a loan due to a real solvency amount, 49% confirmed that this regulation is acceptable and reasonable, while 34% disapproved of them, while the remaining 16% found it difficult to answer this question. 

In the capital, 49% of respondents found the banking regulations acceptable, 40% found it unacceptable, and 11% could not answer the question. As to major cities: 49% positively appraised this regulation, 30% rejected it, and 20% could not answer the question. In villages, 51% approved the regulation, 33% disapproved, and 15% abstained from answering the question. 

This public survey was held from July 13 to July 29, and 2,131 complete interviews were held. The average mean of error is +/- 1,7%. 

What is the business sector’s position, and how does it appraise the NDI’s report? 

Businessman Lasha Papashvili says that it is very difficult for citizens to thoroughly perceive and analyze processes that will bring real results in 6 months to a year. Improper decisions taken by the regulator will bring real outcomes later, the businessman noted. 

“Citizens have one view, and we have another position”, Papashvili noted. 

In response to the question of whether the survey results reflect the negative public attitude towards commercial banks, Papashvili explained  that there is no country in the world, where citizens do not protest against commercial banks. However, communications and commercial banks are inseparable parts of a country, Papashvili noted. 

“Responsible business always appreciates the voice of society, but the system is vitally important. Amid such differences in public opinion, I would blame the regulator in this regard. The regulator intends to harmonize various positions and provide an efficient PR campaign focusing on this important system, and its policy should be to  smoothe over the whole situation”, Papashvili said. 

Businessman Irakli Gurchiani, the founder of Toyota Center Tbilisi, explains that the NDI report is anecdotical. We should not expect any economic revival until usurers have been removed,  until the country is civilized. 

“How can this situation be positive? To buy a fridge, you should have a salary five times higher. Officials assert that the average salary in Georgia is 1,200 GEL, but all of us know that this is not true. Someone has a 30,000 GEL salary, but the majority makes 500 GEL, and it is nonsense to calculate the average figure between these two figures. Today the average salary in Georgia is 500 GEL”, Gurchiani noted. 

In response to the question  of whether the survey results reflect public protest, Gurchiani agreed that public protest may be the real reason behind similar results. 

“Not only do the protests exist in our society, but 90% of our citizens consider commercial banks the enemy. Any citizen that you stop on the street will name commercial banks as one of the reasons for their misfortune. High interest rates are the reason. There is one moment: you should not take loans if you are insolvent, but when you need money very badly, and you need to buy medicine, you have to take loans anyway”, Gurchiani said.