Iran’s Welfare Bank Launches New ‘Support Card’ Initiative to Boost Household Purchasing Power
Iran’s Welfare Bank has unveiled a significant new financial instrument aimed at providing affordable credit to eligible households, including pensioners, employees, and drivers. The initiative, centered around a “Support Card” linked to “GAM Bonds,” is designed to facilitate the purchase of domestically produced goods while minimizing liquidity growth within the national monetary system.
A New Mechanism for Affordable Credit
The program allows qualified individuals to apply for a specialized card, granting them access to credit for installment purchases. Following a credit assessment by the banking network, successful applicants can receive a credit limit starting from 100 million Rials up to a maximum of 3 billion Rials (300 million Tomans), depending on their financial standing.
A key feature of this program is its connection to GAM Bonds. When a customer uses their card at a contracted vendor, the bank settles the payment by issuing GAM Bonds to the benefit of the seller. This innovative model is designed to provide low-cost financing for households while simultaneously supporting businesses by ensuring they receive payment.
Key Benefits for Households and Businesses
For eligible citizens, the card offers a powerful tool to enhance their purchasing power. It provides access to credit without the need for a high account balance or a guarantor, requiring only proof of income. With a competitive profit rate and fee capped at 6.25% and a flexible repayment period of up to 24 months, the program offers a substantially more affordable alternative to conventional installment plans.
For producers and vendors, joining the network of contracted sellers offers significant advantages. The system guarantees payment through GAM Bonds, eliminating the risk of default on installments. It also provides businesses with immediate liquidity, opportunities for increased sales, and access to a wide customer base.
Strategic Economic Objectives
The launch of this financial tool, attended by high-ranking officials including the Central Bank Governor and relevant ministers, underscores its strategic importance. The model is explicitly designed to achieve several key economic goals:
- Support for Domestic Production: The card can only be used to purchase goods produced domestically, directly aligning with national economic objectives.
- Non-Inflationary Financing: By utilizing GAM Bonds for settlement, the scheme aims to provide necessary financing without significantly increasing the money supply.
- Stimulating the Real Economy: The program efficiently connects household demand with the supply from domestic production units, fostering economic activity.
How to Apply
Interested and eligible individuals, including pensioners, can apply by visiting designated branches of the Welfare Bank. The process requires standard documentation, including a national ID card, proof of income, and a bank account number. Following a credit check, the card is issued, enabling holders to make purchases from any approved vendor within the network.
This initiative represents a targeted effort to strengthen household economics and support domestic industries through a innovative and carefully structured financial system.