In the banking community and the state Duma “Rosbaltu” announced support for new high-profile ideas of the government, against so far are the only collectors.
Before you sell the “bad debt” collectors, banks will have to offer it to the borrower, and with the same discount, says”Kommersant” with reference to a developed Ministry of economic development of amendments to the law on recovery of debts from individuals and microfinance activities. According to the publication, the average Agency specializing in debt collection, buying debt from banks of individuals in 2.8% of their size. So in fact, the speech can go about write-off of loans. What can you expect from such a generous offer from the government, “Rosbalt” asked said experts.
Director of the Banking Institute HSE Vasily Solodkov:
First, the debts are different, and not all banks sell them for 2.8% of the borrowed amount. With this discount, sell the debts have been serviced, the borrower had no property, all the while he is not working and not looking for work. That is, to recover the debt for some reason it seems almost impossible. Here, it will be worth 2.8% of nominal value. Banks are more profitable to sell at a large discount because they either don’t seek, or it will cost them much more than the amount they will receive.
But there are other stories, when the borrower, for example, for some reason are not passed to the next loan payment and as security for the debt he has an apartment, the cost of which greatly exceeds the cost of debt. In this case the prospect of recovery is clear, and the Bank sells such a debt is already with a smaller discount. Most likely, he will give it at a price of par, that is, excluding interest. So I’m not sure that 2.8% is the average. I believe that the average figures of 30% of the debt.
Banks get rid of bad debts to clear the balance. Because each loan they deposited money in the Central Bank, and collect them can only be the case if the borrower fully repaid the loan, that is, when on balance it is no longer listed. If loan repayment problems arise, you can sell the debt to collectors or go to court. If the amendment is adopted, banks will have an additional way to get rid of the ballast. A large discount, the borrower will deliver him from the problem.
Remember, we are talking about loans that are impossible to recover. They are actually not so much. Of course, there is a risk that the offer of Ministry of economic development will create a loophole for unscrupulous and maybe for good faith borrowers to pay off the Bank for a smaller amount and not to pay the debt entirely. And yet, the potential of this loophole to use, not so much. People usually do not are interested in that one time to take the Bank a hundred rubles, and return three. If you a hundred rubles is not returned, the credit history will be ruined and no Bank more debt you will not. It’s all understood.
In this case, if the borrower has really fallen on hard times and can no longer cope with debt, the idea of economic development would be his salvation.
The story of the collectors on this background itself will subside, as banks primarily have to offer to buy the debt by borrowers”.
The Chairman of the Duma Committee on financial market Anatoly Aksakov:
I think, and now there are no legislative restrictions for the banks to sell debts of the debtors. But the logic of economic development is clear. If the debt is uncollectible, and the Bank understands that in full it’s gone, I think, even from the point of view of administration costs, is more profitable to sell it at a discount to the client. So we are likely to support this idea.
The question remains: will not provoke this decision of mass non-payment. Such a risk exists, and we need to think how to exclude it. In addition to the amount asked by the Bank, the borrower likely will have to pay a tax for the benefit derived. My friend, being the Deputy of regional meeting, got in a difficult life situation, and the Bank went to meet him, by restructuring the loan. And after he was given a reprimand for unspecified in the Declaration of income. Although, in any case, to pay tax at 13% is not the same as to return the entire debt entirely. Especially if we are talking about large sums, which, for one reason or another turned out to be unaffordable for a person.
I remember as currency borrowers said that their debt, the banks sold at a price for which they would gladly bought them. I remember that the discount to which the portfolios of bad debt goes to collectors, reached 95%. In that situation, the offer of Ministry of economic development could significantly simplify people’s lives and protect against contact with collectors.
I think banks, this idea was not very pleased. On the one hand, they should be no difference whom to sell the debt — collectors or debtors. But if the collectors they sell them EN masse, then borrowers need to establish individual work, and this entails additional costs.
But the Ministry believes that the high debt load of the population carries big risks, and soon the bubble may burst. Apparently, this is the reason they are looking for options on how to cool the situation. Although, there is a more restrained stance of the Central Bank, who believes that the debt load is, but the situation is not critical and it is quite manageable”.
The President of the Association of Russian banks, doctor of legal Sciences, corresponding member of RAS Garegin Tosunyan:
“On the one hand, for banks the offer of Ministry of economic development will result in additional burden, which they will try to compensate by increasing the load on all of its borrowers. On the other, the fact that banks will incur additional costs, does not mean that this idea should be abandoned. The problem really is. A number of banks, using its monopoly position, really put the transfer of bad debt collectors to the conveyor and more or less conscientious borrowers who are in a difficult situation, not ready to go forward.
Collectors they give discounts up to 85%, at least 50-60% accurate because it is assumed that in this way only remove the bad debts. Well, if you have the opportunity, you give the customer a discount, albeit small, before you sell the debt for peanuts collectors. There is a grain of truth. For educational purposes, banks do not for the simple reason that, if we too often resort to this practice, borrowers may create a feeling that to be unfair profitable.
Although, of course, civilized borrowers, most of whom will not use this opportunity to enrich. In critical situations this way. But if there’s another way to repay the Bank, it is unlikely people will risk their credit history, using this discount. In fact the next time a loan they will not give. So I don’t think the Russians will begin EN masse to abandon their obligations to the banks in anticipation of discounts. But for banks this can be an incentive to negotiate with borrowers before the debt has become uncollectible.
But here you need to understand the underlying causes of what is happening. When the interests of the borrowers concerned in such a populist way, I would like to ask our economic agencies: don’t you understand that the problem of bad debts is the high interest rates that resulted from the monopolization of the market? Why, Rada for the interests of borrowers, you in an emphasis do not see? You still legally decide if I should be frowning to look at the borrower before handing the bad debt collectors. These questions are also important, only you solve more fundamental. So I would support, or, on the contrary, criticized the bill when I see the text.
President of the National Association of professional collection agencies (NAPCA) Elman Mehdiyev:
The proposed version of the bill, if adopted in this form will lead to the granting of the legal right not to pay in full its debts to all categories of citizens, not just those who, as is now done, passed the procedure of bankruptcy. The possible consequences and risks of such solution to predict not so difficult. Banks do not want to sell debt, and nobody will buy them. Within a very short time they will lose the opportunity to use the debt ceiling to compliance. As a result, for many will increase the risk of revocation of the license.
Banks will be forced to urgently apply for borrowers in the courts and in enforcement proceedings, which in turn will lead to a sharp increase in the load on the already overloaded judicial system and the FSSP (subnigricans). Also the obvious risks of a significant cooling in consumer lending and the subsequent fall in consumer demand and the slowing economy. It is possible that a compromise variant would be introduction of such benefits is not for everyone in General, and to those who have submitted all the required documents for bankruptcy.
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