OREANDA-NEWS As part of the instruction of President Vladimir Putin, the installment market in Russia will begin to be regulated by the end of 2024. This decision is reported by the Izvestia newspaper with reference to the press service of the Central Bank (CB) of the Russian Federation.

Representatives of the regulator explained the need for innovations by limiting the growth of borrowers' debt burden and building their protection. Unlike borrowers of banks and MFOs, such clients do not have data on all the terms of the contract, the cost of services and the amount of possible overpayment. They may also be unaware of the high penalties for delay and will not be able to take advantage of the restructuring.

"The absence of an effective mechanism for protecting the rights of citizens and providing them with guarantees when purchasing goods (works, services, results of intellectual activity) using installments increases risks for both users and the financial system as a whole," the press service explained.

According to Anatoly Aksakov, head of the State Duma Committee on the financial market, the relevant bill may be introduced in the autumn session. Among the initiatives discussed is the need to report the purchase "in parts" to the credit bureaus in order to take this type into account in the debt burden. However, a number of banks criticize this measure, as they have begun to develop an installment purchase service, and regulation may put an end to the market for payment in shares.

As Alexey Arzamaskin, an expert at the Central Federal District Department of the Central Bank of Russia, noted, Russians should remember the disadvantages of installments. Thanks to the mechanism, the consumer can get the desired product even if he does not have all the necessary amount. However, installments should be treated in the same way as loans — carefully weigh your chances that payments will fit into the budget. Also among the disadvantages are the financial burden and the risk of debt.