According to the information of the Central Bank, as of July 31, 2023, the volume of the loan portfolio in Azerbaijan was 21 billion 372 million manats. This means an increase of 76 million manat compared to the previous month. However, official statistics show that our citizens still living in the regions, as well as those engaged in entrepreneurial activities, have limited access to loans.
Publika.az reports that economist expert, MP Vugar Bayramov noted about this.
“Thus, 16 billion 336 million manats of the total loan portfolio were registered in Baku. This means that more than 76 percent of the total loan portfolio fell to the share of the capital. 805 million manats were offered in the Absheron-Khizi economic district. This means that more than 80 manats of every 100 manat loan given by banks falls to Baku and Absheron. At the same time, this indicates that the regions’ access to loans remains limited.
Credit investments in a number of economic regions still remain small. For example, 151 million manats were invested in Nagorno-Shirvan, which has great potential, and 229 million manats in the Mil-Mugan economic district,” said Bayramov.
The deputy noted that, according to the analysis, one of the main reasons why banks allocate less credit to the regions is that the terms of the collateral mechanism for entrepreneurs living in the regions are difficult:
“Thus, in most cases, banks require collateral in the capital when granting loans, which most local entrepreneurs do not have the opportunity to do. From that point of view, the collateral mechanism should be improved and the volume of preferential loans for entrepreneurs operating in the regions should be increased. “Increasing access to cheap loans for entrepreneurs operating in the regions is one of the important conditions for strengthening inclusive and balanced economic development.”
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