LAW OF THE REPUBLIC OF KAZAKHSTAN

of November 26, 2012 No. 56-V ZRK

About microfinancial activities

This Law governs the public relations connected with implementation of activities for provision of the microcredits, establishes features of creation and reorganization of the organizations performing microfinancial activities of the legal status, organization activity performing microfinancial activities and also determines features of state regulation of the organizations performing microfinancial activities, control and supervision of their activities.

Chapter 1. General provisions

Article 1. The basic concepts used in this Law

For the purposes of this Law the following basic concepts are used:

1) it is excluded

1-1) electronic trading platforms selling bank and microfinancial assets - the Internet resource providing infrastructure to participants for tendering, operating according to the Law of the Republic of Kazakhstan "About state regulation, control and supervision of the financial market and the financial organizations";

2) the credit folder - the documents and data created by the organization performing microfinancial activities on each borrower;

3) the borrower - the physical person or legal entity which concluded with the organization performing microfinancial activities, the agreement on provision of the microcredit;

4) the microcredit - the money provided by the organization performing microfinancial activities, to the borrower in national currency of the Republic of Kazakhstan in the amount of and procedure, determined by this Law, on the terms of the paid nature, urgency and recoverability;

5) the organization performing microfinancial activities - the microfinancial organization, credit partnership, pawnshop performing activities for provision of the microcredits;

6) it is excluded

6-1) large member of the organization performing microfinancial activities - physical person or legal entity which owns directly or indirectly ten or more percent of shares in the authorized capital or voting (less exclusive) shares of the organization performing microfinancial activities;

6-2) faultless goodwill - lack of the outstanding or not removed criminal record, including lack of the court resolution which took legal effect about application of criminal penalty in the form of deprivation of the right to hold leading employee position of the financial organization, bank and (or) insurance holding and to be the large member (large shareholder) of the financial organization for life, and also lack of the relations with the third parties (control and influence of the third parties) whose actions promoted legalization (washing) of income gained in the criminal way, to financing of terrorism and financing of distribution of weapons of mass destruction based on data of authorized body on financial monitoring;

7) the applicant - the physical person or legal entity which submitted the application to the organization performing microfinancial activities for receipt of the microcredit;

7-1) service company - the affiliated organization of bank acquiring the doubtful and bad assets of parent bank, the collection agency having within the trust management agreement rights (requirements) for agreements of bank loan and (or) to agreements on provision of the microcredit (further - the trust management agreement) concluded with person specified in part one of item 4 of article 36-1 of the Law of the Republic of Kazakhstan "About banks and banking activity in the Republic of Kazakhstan" and (or) parts one of Item 5 of article 9-1 of this Law, powers on trust management of the rights (requirements) for agreements of bank loan and (or) agreements on provision of the microcredit, including on change of terms of the contract of bank loan and (or) the agreement on provision of the microcredit, on representation of interests of person with which the trust management agreement, in court is signed on acceptance from the debtor of money and (or) other property, and other powers provided by this Law, other laws of the Republic of Kazakhstan and the trust management agreement;

7-2) consumer microcredit - the microcredit which is not the microcredit provided with mortgage of real estate, provided to physical person on purchase of goods, works, services and (or) other purposes which are not connected with implementation of business activity;

8) authorized body - the state body performing state regulation, control and supervision of the financial market and the financial organizations.

Article 2. Legislation of the Republic of Kazakhstan on microfinancial activities

1. The legislation of the Republic of Kazakhstan on microfinancial activities is based on the Constitution of the Republic of Kazakhstan and consists of the Civil code of the Republic of Kazakhstan, this Law and other regulatory legal acts of the Republic of Kazakhstan.

2. The laws of the Republic of Kazakhstan "About joint-stock companies", "About economic partnerships", "About partnerships with the limited and accessorial liability" and "About credit partnerships" extend to the organizations performing microfinancial activities in the part which is not settled by this Law.

3. If the international treaty ratified by the Republic of Kazakhstan establishes other rules, than those which contain in this Law then are applied rules of the international treaty.

4. And other legal entities performing activities within the specific mode of regulation, regulation of this Law and regulatory legal acts of authorized body, National Bank of the Republic of Kazakhstan accepted according to this Law entered according to the Law of the Republic of Kazakhstan "About state regulation, control and supervision of the financial market and the financial organizations" extend to the microfinancial organizations in the limits provided by conditions of specific mode of regulation.

5. The provisions of this Law applied in relation to banks of the second level extend to the branches of nonresident banks of the Republic of Kazakhstan opened in the territory of the Republic of Kazakhstan.

Article 2-1. The main the purpose, tasks and the principles of state regulation in the field of microfinancial activities

1. Main objective of state regulation in the field of microfinancial activities is establishment of the legal basis of implementation of microfinancial activities.

2. The main objectives of state regulation in the field of microfinancial activities are:

1) regulation of organization activity, performing microfinancial activities, establishment of standards of activities, control and supervision of microfinancial activities;

2) protection of the rights and legitimate interests of consumers of services of the organizations performing microfinancial activities.

3. The basic principles of state regulation in the field of microfinancial activities are:

1) effective use of resources and instruments of regulation;

2) transparency of organization activity, performing microfinancial activities;

3) responsibility of the organizations performing microfinancial activities.

Chapter 2. Microfinancial activities

Article 3. Microfinancial activities, procedure and conditions of provision of the microcredits

1. No. 262-VI ZRK is excluded according to the Law of the Republic of Kazakhstan of 03.07.2019.

1-1. Treats microfinancial activities:

1) activities of credit partnerships for provision of the microcredits to the participants;

2) activities of pawnshops for provision of the microcredits to physical persons on the security of the personal estate intended for private use, for a period of up to one year in the amount of, not exceeding eight-thousandfold size of the monthly settlement indicator established for the corresponding financial year by the law on the republican budget;

3) activities of the microfinancial organizations for provision of the microcredits to physical and (or) legal entities with providing or without providing in the amount of, not exceeding twenty-thousandfold size of the monthly settlement indicator established for the corresponding financial year by the law on the republican budget.

1-2. The organizations performing microfinancial activities (further - the microfinancial organizations), in addition to the activities specified in Item 1-1 of this Article having the right to perform the following transactions:

1) attraction of loans (except for fund raising in the form of loan from citizens as business activity) from residents and nonresidents of the Republic of Kazakhstan;

2) investment of own assets into securities and other financial instruments;

3) rendering consulting services in the questions connected with activities for provision of the microcredits;

4) delivery in property employment (lease) of own property;

4-1) realization of own property;

5) implementation of leasing activities;

6) realization of special literature concerning activities of the microfinancial organizations on any kinds of data carriers;

7) implementation of functions of the payment agent and payment subagent;

8) the conclusion of insurance contracts for and on behalf of insurance companies - residents of the Republic of Kazakhstan as insurance agent;

9) implementation of functions of the agent of electronic payment system according to the legislation of the Republic of Kazakhstan;

10) factoring transactions: acquisition of rights of request for payment from the buyer of goods (works, services) with acceptance of risk of non-payment;

11) forfaiting transactions (forfetirovany): payment of debt obligation of the buyer of goods (works, services) by purchase of the bill of exchange without turnover for the seller;

12) issue to legal entities of the guarantees, guarantees and other obligations providing execution in cash.

1-3. The microfinancial organization performing activities for provision of the microcredits to physical persons on the security of the personal estate intended for private use, having the right to perform in addition accounting, storage and sale of the jewelry containing precious metals and gemstones.

1-4. The microfinancial organizations are forbidden to perform other business activity which is not provided by this Law.

1-5. The microfinancial organization has no right to provide the microcredits to the citizen of the Republic of Kazakhstan from the date of placement of the announcement of the completion of the procedure of extrajudicial bankruptcy or the procedure of judicial bankruptcy according to the procedure provided by the Law of the Republic of Kazakhstan "About recovery of solvency and bankruptcy of citizens of the Republic of Kazakhstan" and also to accept from such persons providing in the form of pledge, guarantees and guarantees under agreements on provision of the microcredit within five years.

Requirements of this Item do not extend to the microcredits provided by pawnshops on the security of personal estate, not being subject to state registration.

1-6. The microfinancial organizations have the right to collect copies of identity documents of nonresidents, for the purposes provided by this Law.

2. The microfinancial organization has the right to provide the microcredits only in the presence of rules of provision of the microcredits approved by its supreme body.

2-1. No. 479-V ZRK is excluded according to the Law of the Republic of Kazakhstan of 29.03.2016.

3. No. 422-V ZRK is excluded according to the Law of the Republic of Kazakhstan of 24.11.2015.

3-1. The microfinancial organization has the right to provide the microcredits by electronic method according to the procedure, determined by authorized body.

3-2. Free of charge voluntary refusal of receipt of the microcredits has the right to identify physical person or to remove it in credit bureau, by means of the web portal of "the electronic government" or objects of informatization of the microfinancial organization integrated with the services placed on lock of "the electronic government".

3-3. The microfinancial organization is forbidden to provide the microcredits to physical person in the presence of information on establishment of voluntary refusal of receipt of the microcredits by it in its credit report received by the microfinancial organization before decision making about provision of the microcredit.

This prohibition does not extend to cases of issue of the microcredit pawnshop.

The microfinancial organization is forbidden to provide the consumer microcredits which are not provided with the pledge of property which is subject to registration, physical person without the consent of the spouse (spouse) which procedure for obtaining and the minimum size of the consumer microcredit on which consent is necessary are determined by regulatory legal act of authorized body.

The microfinancial organization is forbidden to sign the agreement on provision of the consumer microcredit which is not provided with pledge of property with physical person which in the credit report has no information on earlier obtained microcredits and (or) bank loans, without its personal presence at the microfinancial organization. The minimum size of the microcredit is determined by the agreement of the consumer microcredit which conclusion requires personal presence of physical person by the regulatory legal act of authorized body specified in Item 3 of article 4 of this Law.

In cases and procedure which are provided by the regulatory legal act of authorized body specified in Item 3 of article 4 of this Law the microfinancial organization signs the agreement on provision of the consumer microcredit which is not provided with pledge of property with physical person only after receipt of its consent to the conclusion of such agreement. In case of the conclusion of the specified agreement by means of the Internet consent to its conclusion is drawn up in credit bureau, on the web portal of "the electronic government" or by means of the objects of informatization of the microfinancial organization integrated with the services placed on lock of "the electronic government".

The requirement provided by part four of this Item does not extend to cases of the conclusion of the agreement on provision of the microcredit, and also transfer of the amount of the consumer microcredit for the bank account of the seller (supplier) of goods, works and services on the purpose of purchase of goods, works and services which receipt is confirmed by the borrower (buyer).

The microfinancial organization performs transfer of money to the borrower on the consumer microcredit which is not provided with pledge of property based on the agreement on provision of the microcredit signed by means of the Internet which size exceeds the minimum size determined by the regulatory legal act of authorized body specified in Item 3 of article 4 of this Law with observance of the following requirements:

1) not earlier than in twenty four hours from the moment of agreement signature or increase in the amount of the microcredit;

2) after provision by the borrower after the term specified in the subitem 1) of this part, consent to receipt of the consumer microcredit which is drawn up according to the requirements provided by the regulatory legal act of authorized body specified in Item 3 of article 4 of this Law.

In case of provision to the borrower by means of the Internet of several consumer microcredits which are not provided with pledge of property which amount as a result of addition exceeds the minimum size determined by the regulatory legal act of authorized body specified in Item 3 of article 4 of this Law the microfinancial organization observes the requirement provided by the subitem 1) of part seven of this Item according to internal documents taking into account the requirements established by the regulatory legal act of authorized body specified in Item 3-1 of this Article.

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