LAW No. 56 OF 26TH NOVEMBER 2012 OF THE REPUBLIC OF KAZAKHSTAN
CONCERNING MICRO-FINANCIAL ORGANISATIONS
This Law regulates the public relations connected with conducting of activities associated with the granting of micro-credits, establishes special considerations in the legal status, formation, activity of micro-financial organisations, and also defines special considerations in the state regulation of micro-financial organisations, control and supervision of their activities.
CHAPTER 1. GENERAL PROVISIONS
Article 1. The Fundamental Definitions Used in This Law
The following fundamental definitions are used in this Law:
1) accounting registration * the entry of a micro-financial organisation in the register of micro-financial organisations in accordance with Article 14 of this Law;
2) credit dossier * documents and data formed by the micro-financial organisation with respect to each borrower;
3) borrower * a natural person or legal entity which has concluded with the micro-financial organisation an agreement on the grant of the micro-credit;
4) purpose-oriented micro-credit * a micro-credit granted on conditions of its use by the borrower for certain purposes in accordance with the concluded agreement on the grant of the micro-credit;
5) micro-credit * money allocated by the micro-financial organisation to the borrower in the national currency of the Republic of Kazakhstan in amounts and through the procedure defined by this Law, on conditions of pay, fixed term and repayment;
6) register of micro-financial organisations * a single list of micro-financial organisations;
7) micro-financial organisation * a legal entity which is a commercial organisation, whose official status is determined by the state registration at the justice authorities and by the passing of the accounting registration, which carries out activity associated with the granting of micro-credits, and also additional types of activity allowed by this Law;
8) applicant * a natural person or legal entity that presents an application to the micro-financial organisation for receipt of a micro-credit;
9) authorised body * the National Bank of the Republic of Kazakhstan.
Article 2. Legislation of the Republic of Kazakhstan Concerning Micro-financial Organisations
1. The legislation of the Republic of Kazakhstan concerning micro-financial organisations shall be based on the Constitution of the Republic of Kazakhstan, and it shall consist of the Civil Code of the Republic of Kazakhstan, this Law and other regulatory legal acts of the Republic of Kazakhstan.
2. The laws of the Republic of Kazakhstan ‘Concerning Business Partnerships’ and ‘Concerning Limited Liability and Additional Liability Partnerships’ shall apply to micro-financial organisations with respect to part that is not regulated by this Law.
3. If an international treaty ratified by the Republic of Kazakhstan establishes other rules than those which are contained in this Law, then rules of the international treaty shall apply.
CHAPTER 2. GRANTING OF MICRO-CREDITS
Article 3. The Procedure and Conditions for Granting of Micro-credits
1. Micro-financial organisations shall grant micro-credits in amounts not exceeding the eight-thousand-times amount of the monthly assessment index established for an appropriate financial year by the law of the Republic of Kazakhstan concerning the republic's budget, per one borrower.
2. The micro-financial organisation shall have the right to grant micro-credits only when the rules for granting of micro-credits approved by its superior authority are present.
2-1. The micro financial organisation shall be obliged to receive preliminary consent from the authorised body to offer micro credits through the procedure stipulated by the regulatory legal acts of the authorised body.
3. The interest rate for the use of a granted micro-credit shall be specified with conversion to a yearly one irrespective of the period for which the micro-credit is granted.
4. Commission fees, interest and other payments relating to the grant of a micro-credit shall be collected by the micro-financial organisation after or at the moment of grant of the micro-credit.
Article 4. An Agreement on the Grant of the Micro-credit
1. The agreement on the grant of the micro-credit shall be concluded in the written form.
2. Information about the agreement on the grant of the micro-credit concluded by the micro-financial organisation shall be obligatory presented to a credit bureau with state participation on conditions as determined by the legislation of the Republic of Kazakhstan concerning credit bureaus and formation of credit histories.
3. The agreement on the grant of the micro-credit shall contain:
1) name of the micro-financial organisation and the surname, name and patronymic (if any) of the natural person borrower, or name of the legal entity borrower;
2) total sum of the granted micro-credit;
3) term for repayment of the micro-credit;
4) method for repayment of the micro-credit (through ready cash and (or) cashless procedures, in lump sum or by portions);
5) technique for repayment of the micro-credit as determined by the rules for granting of micro-credits;
6) timing for repayment of the micro-credit to be signed by both parties to the agreement on the grant of the micro-credit, with indication of maturity dates and amounts of regular payments containing sums for repayment of the micro-credit and interest, balances of the micro-credit sum as on the next maturity date, and also with indication of the total sum of the micro-credit and interest as on the date of signature of the agreement on the grant of the micro-credit;
7) security for the fulfillment by the borrower of obligations under the agreement on the grant of the micro-credit (if any);
8) amounts of interest rates under the micro-credit, including amounts of the annual interest rate and annual effective interest rate (real worth of the micro-credit) calculated through the procedure established by Article 5 of this Law;
9) responsibility of the parties;
10) other conditions in accordance with the legislation of the Republic of Kazakhstan.
4. The indication to the purpose of the micro-credit, and also procedure for effecting of control over its purpose-oriented use shall be an obligatory condition of agreements on the grant of the purpose-oriented micro-credit.
In case of the non-purpose-oriented use of the micro-credit the borrower shall be obliged to repay the micro-financial organisation the micro-credit ahead of time and to pay interest with respect to the used micro-credit accrued under the agreement on the grant of the micro-credit as on the date of repayment of the micro-credit.
Article 5. The Annual Effective Interest Rate under a Micro-credit
1. The interest rate in reliable, annual, effective, comparable calculation under a micro-credit, which is calculated considering borrower's costs comprising interest, if any * commission fees and other payments to be paid to the micro-financial organisation for the grant, servicing and repayment (refund) of the micro-credit, shall be an annual effective interest rate.
Amount of the annual effective interest rate under a micro-credit must not exceed the limiting amount determined by the regulatory legal act of the authorised body.
2. The rules for calculation of an annual effective interest rate under granted micro-credits shall be elaborated and approved by the authorised body.
3. In case of the alteration of conditions of the agreement on the grant of the micro-credit, which entail changes in the sum (amount) of money obligations of the borrower and (or) term of their repayment, the calculation of a more precisely determined value of the annual effective interest rate shall be made based on remaining debt, remaining period for repayment of the micro-credit as on the date, from which conditions change, regardless payments under the micro-credit effected by the borrower from the beginning of the term of validity of the agreement on the grant of the micro-credit.
Article 6. Security for Fulfillment by the Borrower of Obligations under an Agreement on the Grant of the Micro-credit
1. Fulfillment of obligations by the borrower under the agreement on the grant of the micro-credit shall be secured by methods provided for by legislation of the Republic of Kazakhstan or by the agreement on the grant of the micro-credit.
2. Micro-financial organisations shall be prohibited to accept as security for fulfillment by the borrower of obligations under the agreement on the grant of the micro-credit shares or participatory interest in authorised capital of legal entities, except for shares or participatory interest in authorised capital of legal entities as specified in subparagraph 4) of paragraph 1 of Article 19 of this Law.