Thousands of unreliable borrowers in Armenia to receive state aid to repay loans
Armenian government aid for unreliable borrowers
The Armenian government will allocate an additional 209 million drams (around $539,000) to support citizens labelled as “unreliable borrowers” by banks. The cabinet approved the programme in December last year. So far, 9,630 people have applied, and support has already been approved for 3,594 of them.
According to the Ministry of Labour and Social Affairs, the additional funds will be used to cover programme expenses for April and May:
“The calculation was based on an average of 1,500 beneficiaries applying in February and March 2025.”
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Applications open until 2026
The programme, titled “Promoting the economic activity of unreliable borrowers”, is aimed at individuals with poor credit histories. Beneficiaries can receive loan repayment assistance for a maximum of 24 months. The application process began on 1 February this year and will continue until 31 January 2026.
“Based on February applications, payments were made in March to 1,896 beneficiaries, totalling 70 million drams (over $180,000). Another 1,072 applicants joined the programme in March, and payments to them will begin in April,” said Deputy Minister of Labour and Social Affairs Tatevik Stepanyan.
Over 200,000 people qualify as potential beneficiaries
Only those officially employed by an organisation are eligible for the support – a key requirement of the programme. During a government meeting, Stepanyan stated that 218,000 people fall into the programme’s target group:
“But at the launch of the programme, only 40,600 of them were employed. We believe that by 31 January 2026, we’ll be able to engage at least another 90,000 people. This would mean coverage of at least 60 percent of the target group – or 131,000 individuals.”
However, Prime Minister Nikol Pashinyan responded by saying that these 40,000 citizens should have already applied for the programme:
“We need to understand whether these people are simply unaware of the programme, or if there is another issue,” he said.
What you need to know about the programme
The government has decided to support citizens who have been labelled “unreliable borrowers” by local banks. This applies to individuals who have been unable to meet their loan obligations for at least three years. To qualify, applicants must have an outstanding loan principal of no more than 1 million drams (around $2,500).
The core idea of the programme is that beneficiaries will receive financial assistance equivalent to the amount of income tax deducted from their salary. This sum will be used to repay their outstanding loan obligations.
The assistance period is capped at two years, starting from the beginning of the month following the approval of an application. During these two years, 20 percent of a beneficiary’s salary will be automatically directed towards repaying their debt.
“The goal is to help potential beneficiaries restore their economic activity — to enable them to work legally and to rebuild their creditworthiness and credit reputation,” explain the programme’s authors.
