Minister: Banks, NBCOs face difficulties in recovering unsecured loans

There are currently approximately 1.09 million enforcement documents, more than 60% of which are cases involving monetary claims, Azerbaijan's Minister of Justice, Farid Ahmadov, said in an interview with Report and ITV.

"More than 520,000 of the monetary claims involve just 40 entities. In other words, just 40 legal entities act as claimants in 520,000 enforcement proceedings. These are mainly banks, non-bank credit organizations (NBCOs), entities engaged in the sale of household appliances, and other legal entities," the minister said.

He added: "Here, we mainly see cases where banks and NBCOs provide unsecured loans and subsequently face difficulties in recovering those loans. In such cases, they apply to the court. Once a court decision is issued, the relevant enforcement document enters our enforcement proceedings, and as a result, our workload increases sharply."

Ahmadov highlighted that the ministry is by no means opposed to lending in the country: "It is one of the factors that promotes economic activity. However, we are opposed to a state institution being burdened as a result of a business entity failing to properly manage its risks. The purpose and logic of the law [On Private Enforcement Officers] are precisely that if a debt arises because an entity has failed to properly manage its own risk, that entity itself should bear the costs associated with it."

Read the full interview here.