Starting in 2026, micro-loans will be withheld from indebted Russians.
The Central Bank of Russia (CBR) has announced new measures to address over-indebtedness in microfinance loans, focusing on tighter regulations, interest rate controls, and increased supervision.
The maximum permissible overpayment for microloans will be reduced from 130% to 100%, a move aimed at limiting excessively high rates and reducing the risk of borrowers falling into over-indebtedness.
In addition, the CBR has proposed a three-day "cooling-off" period before issuing a new loan, a measure designed to give borrowers time to reconsider their financial decisions. This period is expected to reduce risks for citizens.
The CBR is also planning to introduce a "one loan at a time until repayment" rule and a ban on individuals from simultaneously obtaining multiple loans from microfinance organizations (MFOs) starting from 2026. These measures are intended to prevent a debt spiral among vulnerable borrowers.
The CBR's initiatives also include increased supervision and removal from official registers of MFOs that violate lending rules, an attempt to curb illegal lending practices. However, illegal lenders still operate outside supervision, highlighting enforcement challenges.
Experts have expressed concerns that these restrictions may stimulate the growth of shadow lending in Russia. The CBR recognises that purely limiting interest rates does not solve credit access problems for low-income individuals and has called for government support, subsidized products, and financial education to complement regulatory efforts.
Ilya Kochetkov, director of the Central Bank's non-bank lending department, clarified details of the proposed measures. The package of proposals has been submitted to the State Duma and will be considered in the fall.
The initiatives were coordinated with relevant agencies and market participants, with most participants in the public discussion supporting measures against over-indebtedness proposed by the regulator.
Despite these efforts, the CBR acknowledges that addressing over-indebtedness in the MFO market is a complex issue requiring ongoing adaptation of regulatory responses, given the growing presence of online and point-of-sale microloan products.
[1] Central Bank of Russia, "Regulation of microfinance market in Russia," accessed May 2025, https://www.cbr.ru/eng/statistics/microfinance/ [2] Central Bank of Russia, "Microfinance market development plan," accessed May 2025, https://www.cbr.ru/eng/statistics/microfinance/plan/ [3] Central Bank of Russia, "Monetary policy," accessed May 2025, https://www.cbr.ru/eng/monetary_policy/ [4] Central Bank of Russia, "Non-bank lending department," accessed May 2025, https://www.cbr.ru/eng/departments/nonbank/ [5] Central Bank of Russia, "Over-indebtedness in microfinance loans," accessed May 2025, https://www.cbr.ru/eng/statistics/microfinance/overindebtedness/
In an attempt to reduce the risk of over-indebtedness among individuals, the Central Bank of Russia (CBR) has proposed decreasing the maximum permissible overpayment for microloans from 130% to 100%, with the aim of limiting high-interest rates. Furthermore, the CBR has highlighted the need for personal-finance education, as solely limiting interest rates may not totally resolve credit access issues for low-income individuals.
