LAW OF THE KYRGYZ REPUBLIC

of October 28, 2025 No. 237

About consumer loan

Accepted by Jogorku Kenesh of the Kyrgyz Republic on September 25, 2025

Article 1. Purpose and scope of this Law

1. The purpose of this Law is relations management, connected with provision and return of consumer loan, and also establishment of the rights and obligations of participants of such relations.

2. This Law is directed to protection of the rights and legitimate interests of borrowers, ensuring transparency and comparability of terms for crediting, the prevention of excessive debt load, prevention unfair the practician, and also stimulation of responsible crediting.

3. This Law is not applied to the acquisition loans, construction or completion of the residential real estate provided with the real estate, except as specified, directly provided by this Law.

4. Operation of this Law extends to banks and the non-bank financial credit institutions, persons under surveillance to National Bank of the Kyrgyz Republic (further - National Bank) including performing transactions by the Islamic principles of financing taking into account the specifics and features provided by the regulatory legal acts of the Kyrgyz Republic regulating the Islamic principles of banking and financing granting consumer loans.

5. Requirements of this Law extend also to the relations connected with provision of consumer loan including cases when the loan is granted for payment of goods, works or services. The provisions of the laws regulating questions of crediting, the Islamic principles of financing and payment by installments (delay) of execution of monetary commitment on payment of goods, works or services are applied in the part which is not settled by this Law and requirements of the bank law.

By the bank law of the Kyrgyz Republic additional requirements to regulation of consumer loans can be established.

Article 2. The basic concepts used in this Law

1. For the purposes of this Law the following basic concepts are used:

1) annual effective interest rate - interest rate in reliable, annual, effective, comparable basis when which calculating the payments of the client connected with receipt of consumer loan are considered;

2) the borrower - the physical person who received or addressed for receipt of consumer loan;

3) the creditor - the legal entity having the right according to the bank law of the Kyrgyz Republic to grant the loans;

4) markup - the rate of return under agreements according to the Islamic principles of banking and financing given to nominal annual percentage rate, and also increase in the amount of the obligation of the borrower in comparison with the price (cost) of goods, work or service in case of complete lump sum payment;

5) indicator of debt load of the borrower - the relation of the amount of average monthly payments of the borrower on all its debt obligations to the size of its average monthly income expressed as a percentage;

6) all-in cost of consumer loan - the cumulative size of all expenses of the borrower under the agreement connected with obtaining and servicing of consumer loan including percent (markup), the commissions and other obligatory payments, and also the goods value addition (works, services) caused by provision of consumer loan. All-in cost is expressed in absolute monetary value and determined according to the procedure, established by this Law and the legislation of the Kyrgyz Republic regulating activities of the creditor;

7) consumer loan - the credit or financing by the Islamic principles provided by the creditor on the terms of urgency, recoverability and the paid nature including for the purposes of payment of goods, works or services with the subsequent payment by the borrower by installments (delay) of execution of monetary commitment within the agreement of consumer loan. The consumer loan is granted to exclusively physical persons for the personal, family or household purposes which are not connected with business activity and generation of profit. Consumer loans can be interest-free or without markup by agreement of the parties;

8) payment by installments (delay) of execution of monetary commitment - the term of the contract of consumer loan provided by the creditor according to which the obligation on payment of goods, works or services can be performed by parts or in later time according to the procedure, established by the Civil code of the Kyrgyz Republic;

9) refinancing - the conclusion of the new relevant agreement of consumer loan for complete or partial repayment of the operating consumer loan;

10) concession of right to claim (cession) - transfer by the creditor of the rights to claim according to the obligation to other person according to the procedure, established by this Law and the civil legislation of the Kyrgyz Republic.

2. Other concepts and terms used in this Law are applied in that value in what they are used in the corresponding industries of the legislation of the Kyrgyz Republic.

Article 3. Parties and subject of the agreement of consumer loan

1. Agreement parties of consumer loan are the borrower and the creditor. In the relations on consumer crediting also the other persons providing obligation fulfillment of the borrower can participate in the cases provided by the Civil code of the Kyrgyz Republic.

2. The subject of the agreement of consumer loan are the money provided to the borrower on the terms of urgency, recoverability and the paid nature and also the goods, works or services paid through the creditor.

The credits and payments by installments connected with real estate acquisition (mortgage) and also other property withdrawn from circulation or limited in turnover according to the legislation of the Kyrgyz Republic do not belong to subject of consumer loan.

Article 4. Provision of consumer loan

1. The consumer loan is granted based on the agreement of consumer loan (further - the agreement) on the terms of urgency, recoverability and the paid nature, including cases of provision of non-interest loan or payment by installments (delay) without markup.

2. The consumer loan is granted to physical persons in case of confirmation of their solvency. Assessment of solvency is performed by the creditor according to its internal procedures and requirements established by the bank law of the Kyrgyz Republic.

3. Information on general terms of provision of consumer loan, the size of interest rate, markup shall be open and available to clients and cannot be subject of trade or bank secrecy.

4. To the conclusion of the agreement of consumer loan the creditor shall provide complete disclosure of information on consumer loan. The refusal in provision of exhaustive information on conditions and/or markup and/or interest rate of consumer loan is not allowed.

5. The creditor shall provide accomplishment of the following requirements when rendering services in consumer crediting of borrowers:

1) the effective interest rate on consumer loan shall not exceed value of the declared (published) effective interest rate on date of issue of consumer loan;

2) to the conclusion of the agreement of consumer loan complete disclosure shall be provided to the potential borrower of exhaustive information on consumer loan, including information on provision conditions, interest rate or markup, all-in cost of consumer loan;

Disclaimer! This text was translated by AI translator and is not a valid juridical document. No warranty. No claim. More info