Foreign currency loan limit increases to GEL 750,000 in Georgia
National Bank of Georgia Increases Loan Cap for Foreign Currency Loans
The National Bank of Georgia (NBG) has announced a significant change in its regulations, raising the cap on unhedged foreign currency loans from GEL 500,000 to GEL 750,000, effective August 1, 2025. This change primarily affects medium-sized businesses and applicants seeking larger mortgage loans who earn in Georgian lari (GEL), as they are prohibited from taking foreign currency loans exceeding this new cap.
According to Aleksandre Dzneladze, the president of the Banking Association of Georgia, this regulatory adjustment is part of the NBG’s long-term strategy to gradually increase the loan threshold to GEL 1 million. The slowed pace of larization (conversion to Georgian Lari) in recent months has influenced the timing of this decision.
Despite some potential complications for certain loan categories, the overall impact of the decision is expected to be limited based on reports from the Banking Association of Georgia. This step aligns with the NBG’s broader plan to carefully manage foreign currency exposure while supporting credit growth, particularly for medium-sized businesses and mortgage borrowers, balancing risk and credit market development over the medium term.
It is important to note that the decision does not affect individuals earning in Georgian lari who wish to take out loans within the current limit of GEL 750,000. Under the new regulation, individuals earning in Georgian lari will be prohibited from taking out foreign currency loans exceeding GEL 750,000.
Aleksandre Dzneladze has stated that this current adjustment is part of the NBG's plan to gradually increase the loan threshold. The Banking Association of Georgia has reported the expected change in the loan cap, and Dzneladze has explained the decision in detail.
In summary, the NBG's decision to increase the cap on unhedged foreign currency loans will primarily affect medium-sized businesses and applicants seeking larger mortgage loans. While there may be potential complications for certain loan categories, the overall impact is expected to be limited.
The National Bank of Georgia's increase in the loan cap for foreign currency loans is part of their long-term strategy, aiming to eventually increase the loan threshold to GEL 1 million.
This adjustment mainly impacts medium-sized businesses and mortgage applicants earning in Georgian lari as they will be prohibited from taking foreign currency loans exceeding the new cap of GEL 750,000.
