Russian Business Promotes Decrease in Loans Interest Rate

Russian business associations consider it possible to further reduce the interest rate on loans for small and medium-sized businesses and self-employed, based on priority sectors or changes in the key rate of the Bank of Russia, TASS reports. 

According to the Russian Ministry of Economic Development, in 2020, as part of the programme for issuing concessional loans (at a rate not higher than 8.5%), more than 17 thousand loan agreements were concluded for a total amount of more than 1 trillion rubles, for which more than 900 billion rubles were issued.

On January 11, 2021, the Russian government approved a decrease in the rate of soft loans to small and medium-sized businesses and self-employed to 7% per annum. Initially, the rate on such loans was set at 8.5%. Under the new rules, its maximum size should not exceed the key rate of the Bank of Russia (4.25%). It is specified that as part of the national project “Small and Medium Enterprises and Support of Individual Entrepreneurial Initiatives” in 2021, it is planned to provide loans at a preferential rate in the amount of 700 billion rubles.

It is noted that a member of the general council of the ‘Business Russia’ union of entrepreneurs, a managing partner of the ‘First’ investment and consulting group, Alexey Poroshin, is convinced that the rate should be reduced. According to him, the rate of around 5% per annum will correspond to the market realities. In turn, the Minister of Economic Development of the Russian Federation, Maxim Reshetnikov, expects that “soft loans will be used both to support current activities and to develop business, launch investment projects”.

Ru-Main, 12.01.2021 

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