Kazakhstan has drafted a resolution that would stop microcredits from pawnshops from being reflected as overdue in borrowers' credit histories. This change is expected to improve the situation for pawnshop clients, according to infohub.kz.
The Agency of the Republic of Kazakhstan for Regulation and Development of the Financial Market has published a draft resolution that would exclude certain data on pawnshop loans secured by collateral from credit reports. Specifically, it plans to remove information about the number of days overdue as of the reporting date, the amount of overdue payments, the amount of penalties (fines, interest), and the date of the last payment.
In simple terms, under the new rules, credit histories for pawnshop loans secured by collateral will no longer show details of overdue payments. Until the contract is closed, the report will only show its status as "Active."
As the agency explained, when a borrower goes to a pawnshop, they may not initially intend to redeem the pledged item. Pawnshops often receive jewelry that has lost its value to the owner. Therefore, non-payment or delay of a pawnshop microcredit does not indicate the borrower's insolvency or poor payment discipline.
The draft is currently under discussion, so the new rules have not yet taken effect.
It is worth recalling that pawnshops were previously excluded from bankruptcy proceedings. The reason for their exclusion lies precisely in the mechanism of loan repayment through collateral.