Government promotes cheap loans in rural areas in Kazakhstan

According to the Ministry of Agriculture, residents of villages and small towns will be able to take 2.5% interest microloans starting next spring.

The new loan has a 2.5% interest rate and a maturity of seven years. It also requires collateral. Those who are eligible for the new loan will be able to borrow up to $16,500 or even $53,800 when it comes to the cooperation of a group of people. Currently, authorities in different regions must choose which companies will issue those loans to individuals. It is expected that people will be able to apply and take microloans at the end of the first quarter.

The first pilot project aimed at increasing income in rural areas was launched in 2019 in the Jambyl region. On December 12, President Kassym-Jomart Tokayev ordered the cabinet to expand the program across the entire country.

The Ministry of Agriculture estimated that more than $111 million might be required next year to issue about 11,000 microloans.

The government said it will allocate $2.1 billion for the program for the next five years. As a result, more than one million people in rural areas will be able to take new subsidized loans.