The state program of preferential car loans is a huge success among Kazakhstan citizens. Every year, the number of people who want to get an “iron horse” at low interest rates increases rapidly. According to representatives of Development Bank of Kazakhstan (DBK, a subsidiary of Baiterek Holding), the key operator of the state program, if in March 2019 more than 13 thousand Kazakhstan people received car loans worth KZT 57.4 bln., in April 2020 their number exceeded 20 thousand people, the total amount of loans reached KZT 98.05 bln. As of January 28 this year, the six second-tier banks had issued 26 958 loans for the purchase of cars made by domestic car manufacturers for a total of KZT 135.8 bln. Although the procedure for obtaining a car loan is fairly straightforward and more funding is allocated to the program each year, the sheer number of applications means that Kazakhstan people have to wait months for their turn to get their cherished keys. Now, with the launch of an online service to check the status of applications, the process of obtaining a car loan has become even more transparent.
Development Bank of Kazakhstan has been the operator of the preferential car loan program since its launch in 2015. Under the state program from the National Fund of the Republic of Kazakhstan, DBK coordinates write-offs from special accounts of second-tier banks with the National Bank of Kazakhstan by checking applications received from second-tier banks for compliance with three conditions for financing end-borrowers: maximum cost per vehicle unit, interest rate and term of the loan. The partner banks review, verify the creditworthiness and approve the loans. The maximum application review period for second-tier banks is 3 working days. Under the programs financed from the Republican Budget and the National Bank of the Republic of Kazakhstan, coordination of write-offs from the special account of second-tier banks with the National Bank of the Republic of Kazakhstan is not carried out.
To check the status of the application, participants of the preferential car loan program who have applied for a loan from Sberbank https://www.sberbank.kz/ru/autoreg, Forte Bank https://bank.forte.kz/credits/carloans, Halyk Bank of Kazakhstan https://halykbank.kz/credit/lgotnoe-avtokreditovanie and VTB Bank Kazakhstan https://www.vtb-bank.kz/individuals/kreditovanie/avtokreditovanie/ should go to the official website of the respective bank, and enter their personal details (IIN or decision number) in the “car queue” or “car loan” section.
Since the launch of the preferential car loan program, Development Bank has disbursed 6 tranches totaling KZT 82 bln: 2 tranches from the National Fund totalling KZT 26 bln. in 2015-2016, 2 tranches from the Republican budget totaling KZT 16 bln. in 2018-2019, and 2 borrowings from DBK via bond issue totaling KZT 40 bln. from Kazakhstan Sustainable Development Fund JSC. It should be noted, however, that lending is revolving, i.e. payments from repayment of existing loans are used to issue new loans. Thanks to this re-disbursement of funds, Kazakhstan people purchased 26 958 domestically-made cars on preferential terms, receiving loans totaling KZT 135.8 bln.
The car industry is one of the priority areas for the development of the non-resource sector in the country, so the preferential car lending program is a powerful support for Kazakhstan's machine building industry in general, and the domestic car industry in particular. The rate of production is growing, and the quality of locally made cars is improving, which is a good sign. In terms of figures, as of the first 6 months of last year, the share of preferential car loans made 17% of total production.
According to representatives of DBK, today the most popular cars under the state program for Kazakhstan people are models of Kia Sportage (1 791 units), Lada Vesta (1 725 units), Hyundai Tucson (3 025 units) and Hyundai Elantra (2 593 units). At the same time, residents of Nur-Sultan and Almaty topped the list of active participants in the state program, with the largest number of car loans issued there, 5036 and 5278, respectively.
