Interest Rate for Loans to Herders Lowered to 18 Percent

By Ch.KHALIUN

Last Friday, Minister of Food and Agriculture R.Burmaa and the Director of the State Bank of Mongolia officially signed a memorandum of mutual understanding on a mid-term program for supporting herders in production, export and technology, and lowered the annual interest rate of loans for herders from 29.5 percent to 18 percent.

Under the memorandum, 17,557 loans will be transferred to terms of 18 percent annual interest. According to the preliminary results of the 2015 livestock census, 153,100 herder families have 55.9 million livestock. Even though the number of livestock is growing, because the prices for products sold by herders are falling in the domestic market, their income is decreasing, underlined government officials.

Mongol Bank reported that 120,000 herder families took out 222.7 billion MNT in loans at 26.5 to 29.5 annual interest rate from Khan Bank and State Bank. Government officials believe that once State Bank lowers its interest rate to 18 percent, Khan and other commercial banks will...