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Saturday, 24 March 2018


Georgian banks vs. Russian money

11.10.2012  |  22:10

Georgian banks vs. Russian money. 28457.jpeg

In September this year young family Lomidze decided to start a business in the hometown of Tbilisi - to open a small cafe with freshly prepared drinks. Having chosen a suitable place and after analyzing everything related to the laws of small business in Georgia and the Tax Code, the family went for a loan. Having submitted all the necessary documents, they waited for the bank's decision within one week. The sum of the loan they wanted to get amounted 15 thousand lari. The failed entrepreneurs were very surprised when the bank refused them. The reason for refusal was, to say the least, unexpected.

Lomidze familiy was inspired by the last year's changes in the Tax Code. The new law was called "soft law" contrary to the previous pretty hard law. Under the new Code, a clear division of the business to micro, small, medium and large was made possible in Georgia. Business, which Lomidze were going to open, falls into the category of micro business with an annual turnover not exceeding 30 000 lari (about 17,000 USD). And since they were not going to use mercenary force, it is completely exempt from tax.

The registration process now also takes little time. You can open business object during 15-20 minutes. To do this, you only need to write an application to the relevant department of the new House of Justice, and you are immediately registered. In this case you need no business license, unless you are going to treat someone or teach.

In general, the last thing was to get a loan. Dato and Ketevan Lomidze had no doubt that the bank would satisfy their request. Monthly family income is 900 USD with a minimum required 700 GEL. They get money without much delay. Their guarantor, Dato's brother, is a civil servant, and his salary is also not less than 700 GEL. An employee of the credit department, who worked with the family, was also full of enthusiasm. He was counting with pleasure the interest, the bank would receive.

The answer came on Friday and sounded like a bolt from the blue. Bank refused a loan. Surprised Lomidze asked why. Reply of the bank employee surprised them even more. "You get Russian money", this was the wording of the refusal. Dato Lomidze really works for the Russian organization, and he receives the money from Russia. But to this day he considered this rather an advantage, at least because of the fact that foreign money "enter the country, and do not leave it".

Deciding that this is not more than a misunderstanding, Lomidze began to appeal to all the banks in a row. But everywhere they have been denied for the same reason. "You know Georgia's relations with Russia, and Russian money is not really unacceptable, but the bank perceives it unstable. And if tomorrow they terminate a contract with you, what would you do? How can you say for sure that you won't be left without a job? Of course, if you had a flat or a luxury car, you could rely for a bank loan", told them in the last bank with large annual interest. This is true, but it is very likely that you will be left without a job, working in Georgia.

The last hope of the family Lomidze is connected to Mr. Ivanishvili, like almost everyone's in this country. At a meeting with representatives of the Georgian business sector, which was held immediately after the victory of the "Georgian Dream" in the election, among other plans, the leader of the coalition spoke about restoration of cultural and trade relations with Russia. He called the Russian market "highly important", saying that this process would be difficult. Therefore Ivanishvili is ready to personally speak conductor of Russian investments in Georgia.

"Imagine: only 2 hours of flight. Russians have nothing closer: we have the sea and the mountains, a very interesting nature and close cultures. Now we should contribute in development of this process and solving problems", he said.

Now in the political and economic space of ​​Georgia there are many people interested in the settlement of relations with Russia. Someone wants to sell Georgian wine in the Russian market, some citrus. Some are waiting for the opportunity to visit Georgia, others - to return the lost business or even the lost land. Lomidze's problem may get lost in this process. But if one day, having turned to the bank, Dato and Ketevan Lomidze receive credit, this would mean that relations with Russia have begun to recover.


Kama Rzayeva


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