Considering the major deterioration of financial standing of borrowers, who have lost their jobs since the full-scale war, the National Bank of Ukraine (NBU) recommends financial institutions to promote consumer loan restructuring or repayment holidays for retail customers.
The NBU issued a respective public notice to banks, nonbank financial institutions, and collection agencies.
Such measures of financial institutions will offer households that are going through difficult times a temporary exemption and an option to repay, when possible.
At the same time, the NBU would like to remind banks, other financial institutions about compliance with rules for servicing consumer loans.
First, during the period of martial law and within 30 days after lifting or cancelling martial law, a consumer shall not be liable under the consumer loan agreement in case of late payment on the consumer loan agreement.
Second, in case of late payment, consumers shall not be liable to pay penalty (fine, interest) and other payments due under the consumer loan agreement for consumer’s failure to discharge (default, partial payment) liabilities under the agreement.
Third, penalty (fine, interest) and other payments under the consumer loan agreement accrued since 24 February 2022 for past due repayments under the agreement are to be written off.
Forth, in case of failure to discharge liabilities under the consumer loan agreement, the institutions are prohibited to increase the interest rate on the loan, provided the variable interest rate is not prescribed by the loan agreement or the consumer loan agreement.
Fifth, for the period of repayment holidays loan interest shall not be cancelled. Such accrual of the creditor is legitimate.
Sixth, compliance with legal requirements is mandatory regarding consumer interactions with other entities for treating a past due loan (ethical conduct requirements).
The regulator may impose corrective measure for failure to comply with said requirements.
Please be reminded, that the NBU has eased a number of regulatory requirements for participants of the financial services markets in order to mitigate the negative consequences of the full-scale war.