In Kazakhstan, amid high base rates, entrepreneurs seek effective tools to develop their businesses. In line with the current needs of businesses, Nurbank, as part of a financial holding, provides its clients with adaptable financial solutions. Its unique approach allows clients to combine leasing and credit products without burdening their credit history. The bank actively finances corporate clients and the SME sector. In an interview with inbusiness.kz, Chairwoman of the Board of Directors of Nurbank, Gulnara Musataeva, discussed the key benefits available, leasing opportunities, risk assessment approaches, and prospects for the transaction business.
– Hello, Gulnara Abaevna! We are increasingly observing the growth of the leasing market. You have a specialized subsidiary within the holding structure – LLP Nur Leasing. How does leasing help borrowers in a high rate environment?
– Leasing rates do not significantly differ from bank rates. However, there is an opportunity to use such financial instruments as subsidies within the programs implemented by the "Damu" Fund, significantly reducing the financial burden on lessees.
Often, one of the conditions for accessing the bank's credit products is the requirement of collateral. With leasing financing, such a condition is absent because the leased item (vehicle, special equipment, machinery) belongs to the leasing company. When borrowing, the client purchases the equipment into own ownership, but with leasing, they can use it for the lease term and, if necessary, redeem it after the term by paying the remaining balance or refuse the purchase.
For corporate clients, the advantage of leasing is the absence of collateral requirements and the need to withdraw significant cash from circulation to purchase machinery or equipment. When using such a financial instrument as leasing, companies gain access to equipment upon making a down payment, which is another difference from bank credit products. When taking out a loan, the client does not make a down payment, but with leasing, an initial deposit is a prerequisite, usually amounting to 10% of the cost of the acquired equipment.
– What are the main benefits of leasing for MSMEs in Kazakhstan? It's no secret that for most entrepreneurs, this is quite a new and unexplored product.
– It's important to understand that not all MSME representatives have the opportunity to purchase equipment or machinery at their own expense. In this situation, leasing is one of the most convenient tools for acquiring equipment.
– Which business segments are leasing and credit products more oriented towards?
– Leasing is geared towards construction companies, enterprises in the oil and gas industry, and companies specializing in leasing specialty equipment under ready contracts and providing transport services.
Nurbank finances large business entities in the following economic sectors: food and beverage production, construction, telecommunications services, extraction, and processing. In the SME loan portfolio, the main sectors of economic activity are services, trade, agriculture, and transport.
Financing women entrepreneurs, startups, and green economy projects is a priority for the bank. Nurbank also focuses on financing educational projects: private schools, kindergartens, and educational and development centers.
– What are the differences in approaches to assessing client creditworthiness in leasing and lending? How is the risk level in leasing transactions generally evaluated compared to corporate lending?
– There are no particular differences. The absence of collateral requirements speeds up the decision-making and transaction process a bit. In case of any credit risks from the client in leasing, proper deal structuring can significantly assist the client in acquiring equipment while minimizing the risk of non-repayment.
One of the main tools for risk reduction includes increasing the down payment, correctly defining the leasing financing term, assisting in selecting equipment based on price criteria, and possibly reducing the number of leased items. Additionally, in the case of acquiring liquid equipment, the leasing company has the opportunity to realize the leased item in the event of a default. This aspect is also considered in determining clients' creditworthiness.
– Kazakhstan has been living with a high base rate for the third year. Despite tight monetary conditions, demand for loans in Kazakhstan is starting to recover, according to National Bank surveys. How is Nurbank transforming its lending policy, and what does it emphasize for SME and corporate clients?
– Amid tight monetary policy and recovering loan demand in Kazakhstan, Nurbank is actively transforming its lending policy by emphasizing a risk-oriented approach, strengthening credit risk assessment procedures, and conducting more thorough borrower financial analysis. Particular attention is paid to service improvements through optimizing application processing times and developing digital service channels while ensuring personalized client support.
Among corporate clients, we focus on supporting the manufacturing sector, financing trade, and developing logistics projects, offering clients customized deal structures and flexible repayment schedules tailored to business specifics.
We are an active participant in government business support programs, particularly for the SME sector – Damu Fund programs. This allows entrepreneurs to benefit from partial interest rate compensation, making loans more accessible despite the generally high rate level.
An individual approach to clients forms the basis of all our activities. We always take into account the business specifics of our clients, offering flexible lending conditions, simplified requirements for trusted borrowers, and individual repayment schedules for industries with seasonal income patterns.
– What about the transaction business? How do you view the development of this area?
– Certainly, the development of transactional business is a priority for Nurbank, as it represents a stable, risk-free source of fee income, allowing for diversification. Income can be conditionally divided into two parts – commission and interest from passive operations: deposits and account balances. In the large business segment, a significant portion of commission income comes from operations related to foreign economic activity. These include currency transfers, bank guarantees, and conversion transactions.
The structure of commission income differs in the SME segment due to several reasons. The main one is that SME entrepreneurs, who frequently conduct transfers, are several times more numerous. Therefore, naturally, such clients generate a significant portion of commission income from cash settlement and transfer operations.
Although the size of commissions charged on such transactions is relatively small, due to the large pool of SME entrepreneurs, the bank can achieve significant commission income. Nurbank offers a wide range of transactional products, and we continuously work on expanding it.
Source: https://inbusiness.kz/ru/news/nurbank-predlagaet-adaptivnye-resheniya-finansirovaniya-biznesa