Leasing of agrifood sector equipment

Leasing provided within the framework of the agri-food equipment
leasing support program in the Republic of Armenia

 

 

Beneficiaries

Individuals, sole proprietors and legal entities, including agricultural cooperatives.

 

Leasing items

Within the program framework, the leasing agreement provides business entities
with equipment used in the following areas:

a. animal breeding, including breeding of cattle, sheep, pigs, poultry, bees, fish,
snails, industrial fur farming,

b. crop production, including greenhouses,

c. refrigeration facilities, including milk storage stations and isothermal cisterns
for milk transportation,

d. operation of sorting and packaging of fresh fruits, vegetables, and grass-and-legumes,
and refining of grass-and-legumes,

e. slaughterhouse activity, mobile and portable modular slaughterhouses, as well as transportation
means for transfer of carcass meat purchased by the slaughterhouse service provider,

f. agro-processing industry,

g. other activities in agri-food industry․

In addition to the equipment used in these areas, the project will provide businesses with cranes and
fixed assets, metal storage containers, and oak containers used in the wine industry.

 

Leasing currency

AMD

 

The total amount of leasing items

• Up to 1 billion AMD
• Up to 200 million AMD, for equipment in the areas of activity referred to in paragraphs “d” and “e”.

The cost of the leasing object includes the price of obtaining the leasing object, the cost of importing the
leasing object to the Republic of Armenia (transportation, including other costs connected with the
transportation, custom clearance, value added tax, etc.).

The equipment should be purchased from the manufacturers and (or) from the retailer, which will provide
warranty and (or) post-warranty service of the equipment, or will do it through a resident legal entity of the
Republic of Armenia guaranteed by them.

 

Interest rate as a result of state subsidy

1%:

• to businesses in border areas receiving social assistance,
• citizens who become disabled as a result of military duty or military service,

3% to businesses in other communities.

ATTENTION: THE INTEREST RATES OF LEASING ARE CALCULATED BASED ON THE NOMINAL INTEREST RATE AND ANNUAL
PERCENTAGE RATE SHOWS COST OF LEASING WHEN INTEREST PAYMENTS AND OTHER CHARGES ARE PAID IN STATED
TIME AND IN STATED AMOUNTS. CALCULATION OF ANNUAL PERCENTAGE RATE YOU CAN FIND IN THE FOLLOWING LINK

 

Мaturity

Leasing is provided for up to 5 years.

 

Lease Payment Procedure

Rent payments are usually carried out in equal monthly annuity by the leaseholder. In some circumstances,
considering the activity characteristics, seasonality and other conditions, Development and Investments
Corporation of Armenia may define break periods (grace period) in which annuity accrued interest amounts
are to be paid in the future by adding them to the fees. Besides, while drawing up the schedule of fees it is set
that after the provision of leasing fees are paid each year at least by 6 equal portions. Break periods are defined
starting from the fourth month of the provision of leasing. Leasing interest calculation example is presented here:LEASING

 

Deposit

20% of the purchase price of the leasing object

 

The subsidization of the leasing is stopped, if:

• there are overdue liabilities of more than 90 days to the Corporation for one year (previous 12 months) or
  the leasing is not classified as a standard under current financial asset classification obligations due to
  overdue liabilities to the Corporation,
• the subject of the lease is not used in accordance with its intended purpose or the rules of operation of the
  subject of leasing are not followed,
• as a result of the monitoring, a violation of the terms of the program was found.

 

Insurance terms of the leasing object

Leasing object is insured for damage and loss risks for the entire period of the leasing contract. Insurance is
carried out at the expense of credit organization.

 

Penalty

If the payment is not paid on schedule, a penalty is set on the overdue part of the payment in the amount of
0.125% for each calendar day till repayment of the overdue liability.

ATTENTION: IN CASE OF NOT FULFILLING OR IMPROPERLY FULFILLING YOUR OBLIGATION, THE INFORMATION
ABOUT YOUR DEBT WILL BE SENT BY THE LENDER TO CREDIT BUREAU WITHIN 3 WORKING DAYS AFTER THE
DELAY, WHERE YOUR CREDIT HISTORY IS CREATED. YOU HAVE THE RIGHT TO ACQUIRE YOUR CREDIT HISTORY
FREE OF CHARGE ONCE PER YEAR.

ATTENTION: HAVING A BAD CREDIT HISTORY CAN LATER HINDER OTHER LOANS.

 

Terms of making a decision on loan application and providing the loan to the borrower

After properly presenting the necessary documents for crediting, the analysis is done, and in the result of
analysis, in case of satisfying the demands of internal legal acts it is represented to the discussion of competent
body. After making a decision on the loan request it is immediately presented to the customer. The period
between the dates of loan approval and disbursement by competent body can’t exceed thirty calendar days.

 

Criteria of making a positive or negative decision on providing the loan

The criteria of loan approval are sufficient levels of current liquidity, revolving funds, profit margin, quantity
of redemption days, service of debt, capital adequacy, pledge realization and security rate and other indexes.
Factors of loan rejection are unsatisfactory levels of the mentioned indexes, as well as the fact of business
description being nonrealistic, unreliability of documents, non-presentation of necessary documents, negative
information from credit register, other causes.

 

Useful information

• In case of non-fulfillment or improper fulfillment of the obligation by the Debtor, the Guarantor and the
  Debtor owe to the Lender a joint liability. The guarantor, under the guarantee agreement, is obliged to be
  liable on behalf of the creditor for the full or partial fulfillment of his obligation by the latter. The Guarantor
  shall be liable to the Creditor with all the property belonging to him in the same amount as the Debtor,
  including principal, interest (term and overdue), other payments stipulated in the Contract, court costs for
  confiscation of debt, and other damages resulting from non-fulfillment or improper performance. In case of
  non-fulfillment of the debtor’s obligation, the credit history of the Guarantor will deteriorate, information on
  the Guarantor’s liability, its size, and the Guarantor will be provided to the Credit Registry and Credit Bureau.
  The rights of the creditor under that obligation pass to the guarantor who has fulfilled the obligation and the
  rights belonging to the creditor as a pledgee to the extent that the guarantor has satisfied the creditor’s claim.
  The guarantor also has the right to demand from the debtor the compensation of the interest paid to the creditor
  and, in connection with the liability on behalf of the debtor, other damages incurred by him.
• In case of necessity to change significant conditions (interest rate, commission, penalty, term, volume of liability)
  which will increase the liability of the guarantor or cause other adverse consequences, the guarantor shall be
  notified in advance (7 days before the change). the mentioned change is made in accordance with the procedure
  pre-selected by the guarantor, and in case of the latter’s consent, the mentioned change is made.
• The customer has the right to communicate by mail or e-mail.

 

List of documents required for the study of the leasing application.

ATTENTION: IN ORDER TO APPLY FOR A LOAN, THE LENDER WILL PROVIDE YOU AN INDIVIDUAL CONSUMER LOAN
TERM SHEET, WHICH WILL PRESENT THE INDIVIDUAL TERMS OF THE LOAN OFFERED TO YOU.

 

Your financial directory: Agricultural loans

ATTENTION: “YOUR FINANCIAL INFORMANT” IS AN ELECTRONIC SYSTEM MAKING IT EASIER TO SEARCH, COMPARE
AND SELECT THE MOST EFFECTIVE OPTION AMONG SERVICES FOR INDIVIDUALS.