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Implementation Of Responsible Lending Principles In The Republic Of Moldova: Drawbacks And Opportunities

Author

Listed:
  • Stela CIOBU

    (Academy of Economic Studies of Moldova, Chi?inau, Republic of Moldova)

  • Victoria IORDACHI

    (National Institute for Economic Research, Academy of Sciences, Republic of Moldova)

Abstract

The huge negative effects of the global financial and economic crisis that increases significant credit risk prompted international community and financial organizations to launch and to promote responsible lending practices, to develop a set of principles and practices in order to minimize credit risk through responsible lending. Responsible lending benefits consumers and minimises the risk of abusive practices and over-indebtedness and this implies lower credit risk for the creditor. In the Republic of Moldova this subject is very actual due to a high level of non-performing loans. According to data presented by the National Bank of Moldova, in recent years the volume and the ratio of non-performing loans in total credit portfolio is continually increasing.The purpose of the research is to establish responsible crediting principles, identify factors, methods and techniques that will minimize credit risk for both debtors and creditors.

Suggested Citation

  • Stela CIOBU & Victoria IORDACHI, 2018. "Implementation Of Responsible Lending Principles In The Republic Of Moldova: Drawbacks And Opportunities," Contemporary Economy Journal, Constantin Brancoveanu University, vol. 3(3), pages 108-119.
    • Handle: RePEc:brc:brccej:v:3:y:2018:i:3:p:108-119
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    More about this item

    Keywords

    responsible lending; credit procedures; credit risk; non-performing loans; credit portfolio; banks; creditor; debtor;
    All these keywords.

    JEL classification:

    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
    • E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages

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