Iranian Central Bank Announces Major Expansion of Interest-Free Loan Programs
In a significant move to bolster economic activity and support domestic employment, the Central Bank of the Islamic Republic of Iran has issued a new directive to 23 operating banks, substantially increasing the ceiling for several key interest-free loan categories.
The directive, based on a resolution by the High Council of the Central Bank, outlines a strategic update to the credit facilities stipulated in the national budget for the current Iranian year. This initiative is designed to empower small businesses, home-based enterprises, and specialized sectors.
Enhanced Support for Small and Home-Based Businesses
A central feature of the new policy is the increased support for small-scale and home-based professions. The individual loan ceiling for these “Employment and Home-Based Jobs” facilities has been raised to 200 million Tomans. Beneficiaries of these loans will have a generous repayment period of up to 60 months, easing the financial pressure on new and growing ventures.
New Ceilings for Specialized Sectors and Employers
The Central Bank has also introduced higher credit limits for specialized fields and employers. For occupations approved by the Monetary and Credit Commission, the individual loan ceiling is now set at 350 million Tomans, also with a 60-month repayment window. Furthermore, a new “Employer Facility” has been established, granting 50 billion Rials for each new employee hired, aligning with the individual loan ceilings and featuring the same 60-month repayment term.
A key stipulation is that new priority sectors will be introduced following a review and announcement by the Ministry of Cooperatives, Labour, and Social Welfare, rendering previously approved categories obsolete.
Focused Backing for Knowledge-Based Companies
Demonstrating a commitment to fostering innovation, the directive includes tailored support for knowledge-based, technology-driven, and creative companies. These entities can now access individual employment loans of up to 90 million Tomans with a shorter, 48-month repayment period. For their establishment, development, and production projects, the loan ceiling is set at 300 million Tomans, which can be increased to 500 million Tomans for companies that recruit elite members identified by the National Elites Foundation.
Streamlined Guarantee Requirements
To facilitate access, the Central Bank has mandated simplified guarantee procedures. For loans up to 2 billion Rials, banks are required to process them based on applicant credit assessment and a promissory note or a single guarantor. For higher amounts, lending will proceed in accordance with the executive by-law for granting micro-loans.
This comprehensive financial package underscores the ongoing efforts to stimulate job creation, support domestic production, and strengthen the national economy through strategic credit allocation.