Government has approved the extension of the car loan support programmes

Government has approved the extension of the car loan support programmes


 

Finmarket.- Prime Minister Medvedev has approved the extension of the government support programmes on preferential car loans: First Car and Family Car throughout the 2018-2020 period with the provision of compensation to banks for their implementation in the previous three-year period.

In accordance with the decree on 23 November, the programmes running since 2015 will retain their conditions. Within the framework of the programmes, credit organisations provide a discount on the deposit payment on the loan in the amount of 10% of the cost of the car (25% for residents of the Far East Region). Lost revenue by banks is compensated by the government from the federal budget.

30,900 cars have been purchased under the loans issued in 2019, as a result of the support programmes given in the same year.

The document has fixed the qualification selection rule for banks participating in the preferential car loan program: subsidy agreements on loans issued in 2020 will be concluded based on the results of qualification selection, from next year onwards. In order to be eligible for selection, banks will have to apply to the Ministry of Industry and Commerce between 1-10 December 2019 with the indication of the planned amount of subsidy, the total planned cost of cars to be sold on credit in 2020 and the planned indicator of the subsidy usage effectiveness. The Ministry of Industry and Commerce, on the other hand, will prepare a register of the banks that will receive subsidies between 1-15 December 2019 and publish it on the online state industry information system.

As written in Kommersant, only cars with price tags below 1 million rubles will continue to be available under the preferential car loan programmes, which actually made Lada cars the main recipients of state support in 2019. The price limit of 1 million rubles was set in the beginning of the implementation of the programme in 2015, which was systematically increased in due course, however, being reduced again from 1.45 million to 1 million rubles in 2019.

The conclusion of a corporate competitiveness programme by a car manufacturer and reception of 1400 points is one of the conditions for including a car in a preferential programme. The list of parties to the agreement has not been disclosed yet. New localisation requirements have been added to the programme this year according to Kommersant: the equipment of vehicles with Russian engines and ERA-GLONASS system or the signature of a SPIC by the manufacturer. Welding and painting (minimum requirements for manufacturers who sign SPICs in the light segment) bring 900 points, however, it’s hard to reach 1400 points without engine production in Russia, wrote the newspaper, citing its source.

The government has resumed the demand support programmes: First Car and Family Car, as well as the preferential leasing of cars and trucks as of July, allocating an additional amount of 10 billion rubles for their implementation: 6 billion rubles for the funding of First Car and Family Car and 4 billion rubles for the leasing of cars and trucks. Meanwhile, as expected, 3 billion rubles will be allocated from the government reserve fund and 7 billion rubles according to the results of the Autumn 2019 budget adjustments.

In accordance with the next three years’ budget, 10.5 billion rubles will be allocated on the subsidisation of preferential car loan support programmes in the Russian Federation in 2020, to be followed by 5 billion rubles each in 2021 and 2022.