Annual interest of pension credits to be lowered step by step www.montsame.mn
Ulaanbaatar /MONTSAME/ On Wednesday, Minister of Labor and Social Welfare N.Nomtoibayar called a press conference to announce that the decision to lower the annual interest of pension credits from 18 to 15 percent is coming into force from January 18.
On the national level, there are a total of 378 thousand pensioners, 60 percent of whom are in debt of credit with 18 percent annual interest. To relieve the financial burden on the shoulders of those pensioners, the Ministry has talked down the annual interest rate of pension credits and established agreements with State Bank and Khan Bank, through which 91 percent of all pensioners are provided services.
With the decision, the pensioners will enjoy 15 percent annual interest credits with 1-6 months of duration from the moment of enforcement of the agreements with the banks. The outstanding credits will continue to be paid in formerly agreed terms, in other words, with 18 percent annual interest.
Pensioners gained access to free choice of banks, through which they receive benefits, pursuant to the decision made at the last month’s meeting of the National Council of Social Insurance. Before this, all pensioners received pensions through Khan and State banks. The decision has also been made in the best interest of the pensioners, so that the commercial banks would be willing to lower their credit and savings' interests to attract more customers, said the Minister.
When asked if the pension credit interest rate will decrease again, Minister N.Nomtoibayar answered that "The Prime Minister has given obligations to gradually decrease the interest rate. The Ministry of Labor and Social Welfare and the General Authority of Health and Social Insurances have been working together on this issue.
Funding is being allocated from the Social Insurance Fund to the banks, with consideration of the banks’ credit flow. As of today, MNT 45 billion has been distributed to the State Bank and the Khan Bank.
Published Date:2017-01-19