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JMF Loan (Youth Business Development Project)

  • Those engaged in farming or entrepreneurship and having work experience in the industry
  • Participants of the “Financial Assistance to Start-up and Operating Businesses in Rural Areas” project, organized by JMF Foundation
Organization of current farming operations (financing of circulating capital)
  • Loan amount: AMD 100,000-5,000,000
  • Term: up to 60 months
  • Annual interest rate: 9%
  • Effective interest rate: 9.4-9.8 % (AMD)
  • Loan interest amount is calculated on outstanding loan balance;
  • Loan security: movable and immovable property
  • Repayment schedule: according to the borrower’s cash flows, not less than twice, with up to 12 months grace period
  • Client’s creditworthiness assessment and credit history are factors considered in making a decision on satisfaction/rejection of loan application – at the moment of applying for or receiving a loan the client should be free from overdue or problematic liabilities
  • In case the borrower fails to fulfill its obligations, both the particular borrower and other members of the group shall bear liability at the expense of their property and/or other funds.
  • The number of guarantors is determined in the following way:
    AMD 1,000,000 – at least 1 guarantor
    AMD 1,000,001 – 2,000,000 000, at least 2 guarantors
    AMD 2,000,001 – 5,000,000 000, least 3 guarantors

Calculation of loan interest rate

Loan interests are calculated on the actual loan balance, considering 365 days in the year. The nominal interest rate of the loan remains unchanged during the entire effective period of the loan.

Moreover, subsidization is provided free of charge, the difference between 9% annual interest rate and 4% annual percentage rate.

If the two-fold of the banking rate (settlement banking interest rated established by the CBA) is less than the interest rate defined by the Company, the two-fold banking rate shall be defined as a maximum interest rate.

Example of calculation of loan interest amounts

Simple example of calculation of a loan interest rate: (Loan amount* interest rate)/ number of months (or days)

Thus, when providing a loan of AMD 500,000, at 13% annual interest rate and 12 months of repayment period, the average monthly interest due to payment shall be AMD 500,000*0.13/12= AMD 5417, from which 4% interest is paid, amounting in AMD 1667 .   It should be mentioned that the actual amount of monthly interests would depend on the loan repayment schedule, yet not exceed the average amount specified above.

Other fees

  • Lump-sum fee is not charged for provision of loan

Penalties

  • In case of delays of loan interests and/or principle payment, a fine is imposed  at the rate of 0.1% on overdue amount  (overdue loan amount and overdue interest amount), for each day of delay

Deadlines for the loan approval and provision

The approval for the loan application, and provision of the relevant information to the applicant as well as the loan provision to the borrower is handled maximum within 30 days.

  • YOU HAVE THE RIGHT TO COMMUNICATE WITH THE FINANCIAL COMPANY WHICHEVER WAY YOU PREFER: THROUGH POSTAL COMMUNICATION OR EMAIL. THE ELECTRONIC SUBMISSION OF THE INFORMATION IS THE MOST CONVENIENT OPTION. IT IS AVAILABLE 27/7, IT EXCLUDES THE RISKS OF LOSING PAPER_BASED INFORMATION AND ENSURES CONFIDENTIALITY.
  • THE COMPANY CAN REQUIRE ADDITIONAL DOCUMENTS OR OTHER INFORMATION FROM THE CUSTOMER BASED ON THE “KNOW YOUR CUSTOMER” PRINCIPLE, DEFINED BY THE RA LAW “ON COMBATING MONEY LAUNDERING AND TERRORISM FINANCING”.
  • www.fininfo.am , “ATTENTION: “YOUR FINANCIAL INFORMATION DIRECTORY” IS AND ELECTRONIC SYSTEM, WHICH MAKES IT EASIER TO SEARCH FOR AND COMPARE SERVICES FOR PHYSICAL ENTITIES AND FACILITATES THE CHOICE OF THE MOST EFFICIENT OPTION FOR YOU”.
  • LOAN INTEREST RATES ARE BEING CALCULATED BASED ON THE NOMINAL INTEREST RATE. THE ANNUAL REAL INTEREST RATE SHOWS HOW MUCH WILL THE LOAN COST FOR YOU IF YOU COVER THE INTEREST RATES AND ALL THE OBLIGATORY FEES RELATING TO THE LOAN PROVISION AND SERVICE IN A TIMELY MANNER AND BY THE AMOUNT DEFINED.
  • IN CASE OF FAILURE TO FULFILL YOUR OBLIGATIONS FULLY OR PARTIALLY, THE CREDITOR SENDS THE DATA TO THE CREDIT REGISTRY AFTER 3 WORKING DAYS, WHERE YOUR CREDIT HISTORY IS FORMED. YOU HAVE THE RIGHT TO GET YOUR CREDIT HISTORY FROM THE CREDIT REGISTRY FREE OF CHARGE ONCE A YEAR.ATTENTION: NEGATIVE CREDIT HISTORY MAY AFFECT YOUR FUTURE ATTEMPTS TO GET A LOAN!
  • IN THE EVENT OF FAILURE TO FULFILL OR IMPROPER FULFILLMENT OF OBLIGATIONS, ASSUMED BY THE BORROWER, THE COMPANY TAKES RELEVANT MEASURES TO CONFISCATE AND REALIZE THE COLLATERAL IN THE MANNER STIPULATED BY THE RA LEGISLATION. IF THE AMOUNT COLLECTED FROM THE REALIZATION OF THE PLEDGED PROPERTY IS INSUFFICIENT TO COVER THE COMPANY’S CLAIMS, THE COMPANY SHALL BE ENTITLED TO COMPENSATION FROM OTHER PROPERTY AND/OR FUNDS OF THE BORROWER.

FOR GUARANTORS

  • GUARANTOR BEARS THE LIABILITY OF REPAYING THE LOAN. IT MEANS THAT IN CASE THE LOANER PERFORMS HI/HER OBLIGATIONS INCOMPLETELY, OR DOESN’T PERFORM THEM AT ALL, YOU WILL PAY INSTEAD.  THIS WILL AFFECT YOUR CREDIT HISTORY AND YOU MAY BE DEPRIVED OF YOUR OWN PROPERTY.
  • YOU WILL BE PROVIDED WITH AN EXAMPLE OF LOAN AND GUARANTEE CONTRACTS, AND A REPAYMENT SCHEDULE.
  • THE COMMUNICATION WILL BE CARRIED OUT BY YOUR PREFERRED METHOD.
  • YOU WILL BE NOTIFIED ABOUT THE CONTRACT TERM CHANGES 7 DAYS BEFORE.
  • IN CASE OF DELAY IN LOAN REPAYMENT, AT THE LATEST ONE DAY LATER YOU WILL BE NOTIFIED ABOUT IT.

THE GUARANTOR HAS THE RIGHT

  • TO REQUIRE INFORMATION ON THE OUTSTANDING AMOUNT OF THE LOAN, ANY TIME.
  • TO REQUIRE FROM THE LOANER THE COMPENSATE THE INTEREST PAID TO THE CREDITOR FOR THE LOAN, AS WELL AS OTHER LOSSES INCURRED INSTEAD OF THE LOANER.

 

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Documents required for loan provision: 

  • Group loan application
  • Loan application
  • ID document
  • Information about incomes (income from agricultural activity and other incomes)
  • Copies of ownership certificates of immovable and/or movable property owned by the borrower.