Money until paycheck Kazakhstan residents began to take online loans more often

The volume of loans granted on the online lending market this year may reach KZT 130,000,000,000. This forecast was provided by IDF Eurasia.

We recall that since January 1, 2020, the activities of the subjects of lending (pawnbrokers, online-lenders etc.) fell under the supervision of the Agency for Development of the Financial Market (AFR). Until July 1 they should undergo registration with National Bank.

According to Alina Dzoyekayeva, Managing Director for Strategic Development of IDF Eurasia, there has been necessity for amendments for long.

“In this event the small online-companies that no longer meet the new requirements will leave. Nevertheless, the volume of granted loans in such organizations may increase by 8.3% to KZT 130,000,000,000 in 2020 (in 2019 this amount was equal to KZT 120,000,000,000). Because the product will become cheaper and more understandable for customers. And, in turn, it will increase investment attractiveness of the sector”, she said.

Referring to the data of the First Credit Bureau, Dzoyekayeva noted that as of October 1, 2019, the share of banks in total loan disbursements amounted to more than 95%, online lending companies and pawnshops consist the remaining 5%. Only 1% of the above-mentioned 5% falls on online loans, that, as experts note, are received by people for the period until paycheck.

Moreover, the representative of IDF Eurasia described the portrait of a borrower who uses micro-loans and online-loans mostly often.

“Clients of a microfinance organization are often women with higher education aged 35 years and over, having family and stable source of income. Individual entrepreneurs consist the significant proportion (32%) Microloans for business are granted in the amount of up to KZT 2,000,000. In turn, 53% of borrowers of online lending services are men aged 18-30. The monthly income of 58% of such clients varies from KZT 65,000 to KZT 150.000. Dzoyekayeva summarized that the average loan amount is from KZT 40,000 to KZT 70,000.

Earlier, the professional participants commented on LS about how new rules for issuing loans will affect the market.