Baku, September 20, 2025
Late-payment charges on loans can quickly swell a borrower’s debt, but Azerbaijani rules cap what lenders may apply, economists say.
Speaking to KhazarTV, economist Xalid Kərimli said that for consumer loans the maximum late – payment penalty is 5%. For business loans, late interest is tied to the Central Bank’s policy rate – now 7% – plus up to 2 percentage points, meaning a ceiling of 9% on late interest.
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He added that penalties can be charged for a maximum of 180 days, and all penalty terms must be disclosed in the loan agreement.
The Central Bank’s latest snapshot shows AZN 529.4 million in overdue loans as of end-July, up 7% (AZN 34.7 million) year on year.
