Iran’s Welfare Bank Launches Major 500 Million Toman Loan Scheme for Retirees and Employees
In a significant move to bolster household purchasing power, the Welfare Bank of Workers has unveiled a new financial initiative: the 500 Million Toman Welfare Card. This scheme, linked to government-backed GAM securities, is set to provide substantial credit support to specific segments of the public sector.
A New Credit Facility
The newly introduced Welfare Card functions as a bank loan facility tied directly to GAM securities. Eligible applicants must already possess these securities to qualify. The card enables holders to make purchases at affiliated retail partners, with the bank managing the settlement process by issuing GAM securities to the merchants. These securities can then be traded among entities until their maturity date.
Who is Eligible?
The initial phase of the rollout targets a specific group of citizens. Retirees, workers, and employees of government organizations who receive their salaries through the Welfare Bank are the primary beneficiaries at this stage.
According to the bank’s CEO, a second phase is anticipated for the next Iranian year. This expansion is expected to open the program to all citizens who hold GAM securities, significantly widening its reach.
Implementation and Usage
The service is not available at all bank branches. Interested individuals must apply at officially designated Welfare Bank branches to register their request.
A core requirement of the scheme is that all purchases must be for Iranian-made goods. Cardholders can only shop at approved stores partnered with the Welfare Bank that supply domestic products. A list of these authorized retailers will be provided upon card issuance.
Financial Terms
The loan attached to the Welfare Card features a 24-month repayment period with a notably low-interest rate of just 5%. The average monthly installment is calculated to be approximately 22.7 million Tomans, with the first installment set at 25 million Tomans and the thirteenth installment around 12.5 million Tomans.
Banking experts have highlighted the dual benefit of this initiative, noting its potential to not only increase the purchasing power of working-class and retired households but also to actively stimulate demand for and support the domestic market for Iranian-produced goods.