A loan/credit line provided to the tourism industry under the "Women in Business" project

Conditions
Loan purpose 
 
Loans to tourism industry 
 
Loan type 
Commercial
 
Loan amount 
 
Minimum AMD 100.000
The maximum amount of the loan is conditioned by:
Loan purpose
Customer’s creditworthiness ,
Security proposed by customer
Assessment  of  credit risk,
Regulatory requirements set by RA Central Bank and international agreements
  Easy Easy + Commercial credit line Commercial loan
Currency AMD AMD AMD AMD
Annual 12-14% 12-14% 12-14% 11-12%
Term 12-36 months 12-48 months 12-36 months 1-60 months
Flat Commission fee 1% 0.5% Not defined Not defined
Security At least a guaranty of 2 individuals At least a guaranty of 2 individuals and collateral of real estate or chattels. The appraised value of the evaluated estate should make at least 50% of the loan amount Real estate or chattels,   Other security means acceptable by the Bank. Real estate or chattels,   Other security means acceptable by the Bank.
 
Business plastic cards
Arca, Master, Visa plastic cards are provided at 50%  discount against annual service fee available at that moment:
Payroll project
Visa Gold or MasterCard Gold cards are provided to a company’s  director or private entrepreneur without service fee, and Visa Platinum  card is provided at 50% discount against the acting annual service fee
Employees are provided with Visa Classic, Master Standard, Arca Classic  at 50% discount to the acting annual service fee
Credit lines with the transfer of  salary are provided to the employees  at annul 14% interest rate:
 
Interest on unused part of the credit line 
1%
  
Home Bank
50% discount against the acting annual service fee
 
Redemption frequency and procedure
 
Monthly,  annually- equally (annuitant), or non-equally (differential)
It is possible to define a loan repayment flexible schedule depending on the peculiarities of the financed activity. 
Grant way 
By cash and cashless
 
Loan to pledge value ratio 
Maximum 80%
Guaranty 
Real estate security is made by the customer at the insurance company licensed by RA CB and cooperating with the bank, according to the tariff determined by the latter. The tariffs vary from 0.15-0.2% based on collateral type.
 Insurance for cars is made by the customer at the insurance company licensed by RA CB, according to the tariff determined by the latter. The tariffs vary from 2.5-3 % of the loan amount
 The minimum of the pledged estate assessed value and loan amount is taken as a basis for the insurance.
Real estate appraisal
 
Is realized by any assessment organization licensed by RA legislation and cooperating with the Bank, according to the tariff determined by the latter. The tariff may vary :
In case of cars – AMD  15.000-20.000
In case of real estate – AMD  20.000-200.000 
Collateral arrangement expenses
 
All the expenses related to the collateral arrangement (notarization, registration of the real estate in subdivisions of Cadastral territory) shall be borne by the borrower.
Pledged  vehicle notary fee - AMD 12.000
RA Police Fee (barrage and for pledge of real estate ) - AMD 5.00
Pledged real estate  notary fee - AMD  16.000-25.000
A unitary  reference (on restrictions against real estate) - AMD 10.000
Certificate on the registration of right to real estate- AMD 27.000-100.000
Decision period
 
For large  loans - up to 25 working days,
For medium, small and micro loans - up to 20 working days (in case of collateral  the loan is provided within 2 working days following the receipt of registration right over the pledge)
For Easy, Easy +  loan types 0- up to 3 working days 
Loan arrangement is realized
 
ARMECONOMBANK OJSC Head office and branches
The tourism industry includes the below mentioned types of activities:
• Hotels
• Guest houses
• Resorts
• Restaurants
• Hostels
• Tour agencies
Additional services The customers of the given loan type will be granted by an opportunity to sign a cooperation agreement by the Bank on installment lending, within the framework of which services rendered by Borrowers will become more accessible. Moreover, an additional financing (credit line) in the amount of AMD 100.000 without a mandatory request of guarantor will be available for the entities signing installment agreement.
In case of provision of credit line with Visa Classic credit card the annual service fee of the card is defined AMD 500.
 In order to enjoy the aforementioned service, the Customer should submit an application within 7 working days after being provided with an installment loan.
To get acquainted with the details of the credit line please visit the following link:https://www.aeb.am/hy/ekamti_himnavorumov/    The Bank’s cashless payment terminals (POS terminals) may be installed in the Borrower’s trade outlets, for which the following commission fees are defined:
• For the transactions executed through ARCA payment cards -  1.2%
• For the transactions executed through  MasterCard և VISA  payment cards issued in RA - 2.3%,
• For the transactions executed through  MasterCard և VISA  payment cards issued  by foreign banks - 2.4%:

ATTENTION. On the purpose of due diligence of the customer envisaged by RA law on “On combating money laundering and terrorism financing”, the Bank may request additional documents or other information from the consumer based on <<Know your customer>> principle, as well as ask the consumer additional questions during oral communication.

ATTENTION. In compliance with the agreement signed with USA, to find out whether you are a US tax payer, the bank may collect additional information about the agreements, contracts, cooperation, membership signed by financial institutions, which may have a direct impact on the consumers (e.g. Foreign Account Tax Compliance Act (FATCA)).

ATTENTION.
In case of early repayment of more than 20% of the principal amount of the loan (which does not include the repayment of the part of the loan provided for by the repayment schedule in the given month) without the written consent of the Bank during each month, a fine of 5% of that amount is calculated in case of loans exceeding the amount of AMD 5,000,000 as of the first day of the given month,.

ATTENTION. When applying for a loan, the Bank provides you with an individual leaflet on essential terms of consumer loan, which defines individual terms of the loan to be provided to you.

ATTENTION. As an additional means of loan security, the Bank may also require the guarantees of other person/persons.

ATTENTION. In case of non-fulfillment or improper fulfillment of your obligations the lender sends your data to the credit bureau where your credit history is being formed up to 3 business days. You are entitled with the right to get your credit history from the credit bureau free of charge once a year( https://acra.am/?lang=hy )

ATTENTION. Bad credit history may prevent you from receiving other loans in the future

ATTENTION. Loan interests are calculated based on the nominal interest rate and the actual interest rate shows how much the loan will cost in case of fulfillment of loan obligations in defined terms and sizes. The actual annual interest rate calculation procedure can be found on the following link: https://www.aeb.am/media/2019/06/2640.pdf[br]
The payments to be paid by the consumer are not included in the calculation of the actual interest rate irrespective of the fact that payments against the works and services have been made with or without a credit.

ATTENTION. The nominal interest rate may be changed by the bank. The information on the changes of the nominal interest rate may be found on https://www.aeb.am/media/2019/05/2631.pdf 

1.You are eligible to communicate with financial institution by the means of communication you prefer – through postal services or electronically. The receipt of information electronically is the most convenient. It is available round-the-clock (24/7), is free of the risk of loss of paper information and ensures the confidentiality.

2. The possible negative consequences, penalties/fines for the customer in case of non-fulfillment of obligations
• 0, 13%a of the unpaid amount for each overdue day
• 0, 13%a of the unpaid interest amount for each overdue day

3. If you have outstanding liabilities against the creditor, while fulfilling your obligation the loan repayment arrangements are made in the following sequence:
• Court costs (if any)
• Collateral sale costs (if any)
• Accrued penalty
• Accrued interest
• Insurance costs /if any/
• Principal amount of the loan

4. Property (house, car, etc.) pledged by you may be confiscated by law in case you fail to perform your loan obligations on time.

5. In case of non- fulfillment of loan liabilities, the loan liabilities are covered by the collateral, and should the collateral be not enough to repay the borrower’s liabilities it is possible to repay the liabilities on the account of another property of the borrower and/or guarantor(s)/co-borrower/s/.

6. Loan interests are calculated towards the loan balance.
For example if the customer is provided with a loan in the amount of AMD 1.200.000 with an annual interests rate of 24% ,with 12 months period (while calculating monthly accrued interests as a number of days 30 days period has been taken as a basis).
Months Loan balance Repayment from loan Repayment from interest
1 1.200.000 100.000 23.671
2 1.100.000 100.000 21.699
3 1.000.000 100.000 19.726
4 900.000 100.000 17.753
5 800.000 100.000 15.781
6 700.000 100.000 13.808
7 600.000 100.000 11.836
8 500.000 100.000 9.863
9 400.000 100.000 7.890
10 300.000 100.000 5.918
11 200.000 100.000 3.945
12 100.000 100.000 1.973

7. WE SHOULD REMIND THAT THE EXCHANGE RATE FLUCTUATIONS MAY HAVE AN IMPACT ON THE REPAYMENTS OF LOAN PROVIDED IN FOREIGN CURRENCY.

8. The Bank applies no limits to loan amount; it will be conditioned by and related to:
• Purpose of loan
• Customer's creditworthiness
• Collateral offered by the customer
• Loan risk assessment
• Requirements of prudential standards provided by the Central Bank of Armenia

9. “ARMECONOMBANK” OJSC can provide services to the customer under terms which may differ from those set forth in the Bank's overall policy taking into account any of the following conditions of the below-mentioned list:
• Customer account balance
• Customer account turnover
• Strategic importance of the customer for the Bank
• Number of employees in customer organization
• Total number of cards issued for customer organization
• Income gained from customer
• Volume of transfers
• Size of deposits with the Bank
• Significant borrower
• Social considerations (medical organizations, educational institutions, etc.)
• Being the head of such organization
• Other objective conditions

10. The borrower pays interest to the bank for using the loan amount, the interest of which is calculated on the loan balance for the calendar days of actual use of the loan based on a 365-day year. For loans under specific projects the interest calculation may be based on a 360-day year.
• Loans are repaid within the dates indicated in the loan agreement.
• The periodicity of interest payments is determined in accordance with the loan agreement or repayment schedule.
• If the repayment date for principal or interest rates falls on day off, the payment is made on the following working day without calculation of penalty for the days off.

11. Repayment of Loans
• Loans are repaid within the dates indicated in Loan Agreement
• Loans are repaid in the currency in which they were given • In case of loans in foreign currency, exchange rate fluctuations may affect loan payments
• In case of exchange rate fluctuations, the exchange rate risk related to loans will be borne by the borrower

12. The Bank may terminate the Loan Agreement and request repayment of the loan amount, if
• The borrower has failed to make any payment required under Loan Agreement
• The borrower has breached any confirmation made by the him/her and fails to correct such breach within 30 days following the occurrence thereof
• Any presentation, warranty, document, or information provided by the borrower is materially incomplete
• By reasonable opinion of the Bank, an essential negative change has occurred in financial state of the borrower, including court orders, outflow of assets, deterioration or termination of business, company re-organization.
• The borrower undergoes dissolution, or is subject to ongoing or pending bankruptcy proceedings
• The borrower interferes with monitoring
• In case of other objective reasons

13. The Bank may accept as collateral:
• Real estate: land, houses, buildings, apartments
• Fixed assets
• Circulating assets
• Motor vehicles
• Precious metals
• Treasury bills, foreign currency, stocks
• Property to be purchased and ownership right
• Cash

14. The appraisal value of movable and immovable real estate is based on the market value indicated in appraisal statement.

15. The loan or a part thereof, as well as the accrued interest is deemed overdue if not repaid within periods specified in the Agreement.
• In case of non-repayment of the amounts (the loan, interests other payments) within the term(s) set by the Agreement, Borrower shall pay a penalty in the amount of 0.13% (zero point thirteen percent) of the overdue amount for each day of default. The total amount of the unpaid interests calculated in accordance with this paragraph shall not exceed the current debt balance.
• In case of non-repayment of the loan or a part thereof within the term(s) set by the Agreement, the Borrower is obliged to pay interests to the Bank in the amount of double of the settlement rates set by the Central Bank of Armenia. The  total amount of the unpaid interests calculated in accordance with this paragraph shall not exceed the current debt balance.
• Starting from the 91st day of overdue days, 21,5% annual interest rate is applied to the balance of non-overdue loan (term loan). After the full repayment of outstanding amounts, penalties and interests accrued, the interest rate set by the Loan Agreement is recovered.

16. The Bank shall not accept the following items as collateral:
• Non-circulating assets
• Separate parts of indivisible property
• Leasing right
• Property owned by urban, rural, and local communities
• Property with ownership right

17.To satisfy the claim of CREDITOR-PLEDGEE, the pledged property may be confiscated in extrajudicial manner pursuant to paragraphs 2-4 of these Rules in case of non-fulfillment or improper fulfillment of the obligations by PLEDGER under Collateral Agreement and by BORROWER under Loan Agreement.
  2. The property confiscated in extrajudicial manner may be sold if under the Pledge Agreement PLEDGER has authorized CREDITOR-PLEDGEE to sell the pledged property upon emergence of the grounds for confiscation as stipulated in paragraph 1 of these Rules without seeking court intervention and so fully recover the claim covered by the collateral and has also agreed to transfer without seeking court intervention the ownership of the pledged property against the respective part of main liability to CREDITOR-PLEDGEE or any person designated by the latter in the manner provided by RA legislation.
3.Upon emergence of the grounds for confiscation as stipulated in paragraph 1 of these Rules, CREDITOR-PLEDGEE shall duly notify PLEDGER in writing of confiscation of the pledged property (confiscation notice). In two months following the date of delivery of confiscation notice to PLEDGER, CREDITOR-PLEDGEE shall have the right, pursuant to Article 195 of RA Civil Code, to sell the pledged property directly or through public auction pursuant to RA Law on Public Bidding.
4. PLEDGER undertakes to transfer the pledged property to CREDITOR-PLEDGEE within two months following the date of delivery of confiscation notice to PLEDGER.
 5. The duration of process of sale of pledged property may not become a ground for cessation of growth of BORROWER's liabilities to CREDITOR-PLEDGEE. Moreover, the proceeds from sale of collateral shall be utilized to fully cover CREDITOR-PLEDGEE's claims to BORROWER existing as of the date of sale of collateral and, should the claim not be covered on the account of the collateral, the outstanding amounts may be confiscated from other property of BORROWER.
    6. Confiscation of the property pledged to cover CREDITOR-PLEDGEE's claims by court order may be executed in the manner provided by RA legislation.

18. You can get acquainted with the tariffs on any service by visiting the following link: https://www.aeb.am/hy/sakagner/ :

19. You can get acquainted with the terms and conditions of remote banking services by visiting the following link: https://www.aeb.am/hy/mobile_banking/
 
20. Loan history and Score grading

The essence of credit history

Credit history is a set of information on quality of fulfillment of current and closed financial liabilities of the customer, which is collected in the Credit Bureau based on the information provided by credit organizations.The information collected is systemized by the Credit Bureau and as needed (Application of a new loan, monitoring of acting loan and etc) is provided to financial institution having the appropriate authority making the request. The client's credit history is essential for the lending organization in order to assess the creditworthiness of the given client and to make a decision to grant or reject a loan.

To change an incorrect or incomplete credit history, the client can apply to the ACRA Credit Bureau by submitting a written application manually or electronically, find out what information is stored about him/her and what is the source of the incorrect or incomplete information.

To submit an application to ACRA Credit Bureau, please visit the following link: https://acra.am/?lang=hy

Please   follow    the    link   below    for   the    importance   and   significance   of   credit   history: https://www.abcfinance.am/lifesituations/credit-history.html

The nature of credit SCORE scoring

When granting certain types of loans, the financial organization uses a scoring system for assessing the creditworthiness of the client. The SCORE grade of the Applicant is mainly formed from various criteria of the credit history, based on which the applicant's creditworthiness is assessed using a scoring system. The score allows the financial organization to model and predict the possible behavior of the applicant during the period of the new loan, taking into account the eagerness of the applicant to repay previous and current obligations, the frequency of taking on new obligations and other criteria.

ARMECONOMBANK OJSC company uses the scoring system of evaluation developed and implemented by the Bank.

The factors affecting the SCORE grade are: credit burden, availablity of recorded income, previously overdue liabilities and etc. Each equest of credit history may have a negative impact on SCORE grade of the particular applicant and reduce it.

The customer's credit history and score can be improved by taking the following steps:
• fully repay existing overdue loan obligations and exclude even one day delays in performance of obligations on current loans;
• avoid becoming a guarantor for loans of untrustworthy persons in the future;
• have recorded income.

Please follow the link below for the importance and significance of credit history: https://www.abcfinance.am/lifesituations/credit-history.html
   
Demands
Borrowers’ requirements
Resident sole entrepreneur.
Corporate entity
Term of activity – minimum 6 months
Negative decision grounds
Inadequacy of the customer’s financial condition analysis results to the standards of this procedure and other internal legal acts at the moment of applying.
Insufficient profitability and high risk of the presented project.
Insufficient argumentation of the loan purpose.
Non-credibility of the presented documents.
Insufficient liquidity of loan security.
Pollution or damage to the environment caused by customer’s activity.
Other reasons which according to the Bank assessment will hamper the loan repayment.:
Attention! In case of preterm repayment of credit line without the Bank’s written consent a penalty in the amount of 5% of the credit line’s initial amount shall be applied.
Attention! As an additional loan security means, the Bank may also require the guaranty of one or more persons
Attention! The interests are calculated on the loan balance.
Attention! The bank may amend the loan’s nominal interest rate
General Information
Documents to be presented by legal entities
 
Punct Copy of State Register certificate, transcript on the executive authority is mandatory or a statement given by Unified State Register (the latter may not be required if the Bank receives the given information electronically in defined order).
Punct State Register statement on participants, replacement of the director, and amendments to charter (the information may not be required if the Bank receives the given information electronically in defined order). In case of joint stock companies, statement on shareholders from Central Depository of Armenia OJSC and State Register statement on replacement of the director, and amendments to charter (the information may not be required if the Bank receives the given information electronically in defined order).
Punct The information listed in paragraph 2.1 is not required for corporate entities in case where the decision on borrowing may be made by the director;
Punct Charter (reviewed) (the document may not be required if the Bank receives the given information electronically in defined order)
Punct Authority's decision on borrowing, and pledging property (necessary if the information listed in paragraph 2 is required)
Punct Set of financial reports for the latest accounting period. If necessary, approved (sealed or stamped) by applicable tax authority (copy)
Punct Statement of settlements with State budget or statement on liabilities to State budget from the tax authority of relevant location (mandatory for loans exceeding AMD 10 mln or foreign currency equivalent thereof)
Punct List of fixed assets (if necessary)
Punct Tax code (copy); TIN.,
Punct Licenses (copy), if any
Punct Passport (copy)
Punct Documents supporting the ownership right to the property offered as loan security
Punct In case of collateral owned by individual, certificate of marriage (divorce, death of spouse)
Punct Bank account statement (if necessary)
Punct Statement of accounts receivable and payable (with breakdown if necessary)
Punct Agreement (copy) with supplier and invoice for import of goods
Punct  Statement on ban from Real Estate Cadastre Department (after lending decision)
Punct Other documents, is necessary
 
Documents to be presented by sole entrepreneurs
 
Punct Copy of State Register certificate, transcript on the executive authority is mandatory.(the document  may not be required if the Bank receives the given information electronically in defined order)
Punct Tax code (copy); TIN
Punct Set of financial reports for the latest accounting period. If necessary, approved (sealed or stamped) by applicable tax authority (copy)
Punct Statement of settlements with State budget or statement on liabilities to State budget from the tax authority of relevant location (mandatory for loans exceeding AMD 10 mln or foreign currency equivalent thereof)
Punct Licenses(if any) (copy)
Punct Passport (copy)
Punct Documents supporting the ownership right to the property offered as loan security
Punct In case of collateral owned by individual, certificate of marriage (divorce, death of spouse)
Punct Bank account statement (if necessary)
Punct Statement of accounts receivable and payable (with breakdown if necessary)
Punct Agreement (copy) with supplier and invoice for import of goods
Punct Statement on ban from Real Estate Cadastre Department (after lending decision)
Punct Other documents, if necessary
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Updated: 01/11/2024 17:14