Loan types and the bank lending channel

Поласова Акнур Сахаевна

Магистр, специалист по закупу

ТОО «Электровоз курастыру зауыты»

Annotation : The loan process is relationship between the borrower and the lender represented by a commercial bank. The lending procedure determines the type of loan, its terms, the loan amount, the interest rate on the loan. The article discusses the main types of loans by the nature of the loaned value, their main characteristics, pros and cons.

Key words: loan, loan, types of loans, commercial loan, Bank loan

Loan types and the bank lending channel

Termin of loan means the loan that was provided for the needs of a receving party in cash on the terms of repayment and, as a rule, payment (in the form of interest for using the loan) [1, p. 11].

A loan contributes to the growth of production and trade, the movement of capital within the country, the transformation of monetary savings into investments. The economic role of loans lies in its ability to unite small, disparate funds, allowing the market to actively influence the concentration and centralization of production and capital.

Types of loans are classified according to various criteria. Based on this, the following types of loans differ as:

1. Commodity loan is the provision of goods by one party in a transaction to the other party. The client who received the property undertakes to return the same property within the agreed period and pay interest rate on time. A characteristic feature of a commodity loan is that it provides certain items.

2. A cash loan is a transfer of a certain amount of money for temporary use. In modern economic conditions, the monetary form prevails. This form of loan is actively used by all subjects of economic relations (the state, enterprises, individuals) within the country and in foreign economic turnover. A monetary loan is not equivalent to a commodity-money exchange, there is only a transfer of value for temporary use with the condition of return after a certain period and, as a rule, with the payment of interest for its use.

3. A commodity-money loan arises when the loan provided in the form of goods, and returned in money, or provided in money, and returned in the form of goods. In the domestic economy, the sale of goods in installments is accompanied by the gradual repayment of a cash loan.

Commercial loan is provided by one legal entity to another in commodity form. It is used in the procedure of a commercial transaction to defer payment or profit from the sale of products in the shortest possible time. «This is a corporate loan or a supplier’s loan, which consists in deferring or installment payment for the goods sold» [2, p. 104]. The settlement procedure for this type of loan between the parties (suppliers and recipients) is established by the contract acting as a bill of exchange. Any legal entity engaged in commercial activities, and not only banks and monetary organizations, can act as a loanor. The amount of payments for this type of loan usually includes the cost of the product, while the loan term may be significantly lower than the average sales period of the product itself.

Positive sides of a commercial loan:

1) the possibility of using additional funds without a bank loan;

2) improving the economic sustainability of the recipient company;

3) the loan could be obtained at an interest rate that is actually lower than that set by the state regulator.

Negative clauses as:

1) depends on inflation;

2) has short-term and limited assets;

3) the dependence of the supplier company on the integrity of the partner.

A bank loan is a type of loan that is provided by loan and financial organizations authorized by the National Bank of Kazakhstan. These types of loans can be targeted or non-targeted. The bank uses the funds raised to issue them to borrowers with a return of interest. The borrower chooses the rate, repayment period and loan amount from the options offered.

Positive sides of a bank loan:

1) the possibility of obtaining additional resources to solve the task and distribute the financial burden;

2) transparency of the terms of granting and repayment;

3) reliability – the bank has the right to carry out its activities on the basis of the license of the National Bank of Kazakhstan, which would be canceled in case of violation;

4) the interest rate is lower than for a similar type of loan.

Minuses as follows:

1) overpayment — bank lending applies an interest rate;

2) the risk of refusal by the bank to provide such a loan – this is usually associated with a bad loan history of the borrower.

The state loan is issued at the expense of the federal budget through the National Bank of Kazakhstan. State types of loans are provided in the following cases:

1) if a subject of the Kazakhstan or a specific industry needs financing;

2) for the purpose of raising funds, if it is planned to place government loans on the securities market (in this case, the borrower is the state itself);

3) to finance international targeted programs;

4) when loan regulation of the economy is required.

Positive sides as follows:

1) the possibility of increasing the revenue part of the budget without the use of emissions;

2) the possibility of regulating monetary policy within the country (when surplus funds are withdrawn from circulation in the event of inflation).

Minuses provided below:

1) the collected funds have only purchasing and payment characteristics;

2) the payment of interest on a loan in the country may lead to higher taxes, which, accordingly, will lead to a decrease in economic growth.

Consumer loan is used for consumption: from the purchase of this product to the repair of housing, etc. In the role of borrowers – individuals. This loan can be issued by banks and various microenterprise organizations.

The loan can also be used to purchase goods in installments. These types of loans are issued by a banking organization that cooperates with a trading company, and the overpayment on the loan

is paid by the store itself (if the installment plan is free of interest).

The growth in consumer lending is caused by the following reasons — the relative stabilization of the macroeconomic situation in the country, a decrease in the level of profitability of other areas of activity of banks, increased competition in the banking sector [3, pp. 69-97].

A mortgage loan is one of the categories of targeted loans, it is provided to individuals for the purchase of real estate. «A kind of loan that is provided against the security of real estate» [4, p. 99].

Leasing loan is a type of loan that includes the rental of a product and its further acquisition as property. However, the borrower has the right to cancel the purchase and terminate the lease agreement. Currently, the most common types of leasing are the purchase of cars, trucks and special equipment.

International loan includes the conclusion of purchase and sale transactions at the international level between countries, various companies trading on the foreign market.

In this article, the classification of loans was considered only on one basis – the loaned value. Loans also differ in purpose, form of collateral, structure, size, collection procedure and a number of other features. For example, the internal structure distinguishes between a simple loan, an acceptance loan, a revolving loan and a syndicated loan. Depending on the size of the interest rate, it is possible to allocate loans with a positive interest rate, interest-free loans (the interest rate is zero) and loans with a negative interest rate. In modern economics, there is no consensus on what is the main feature for the classification of loans, since it is not clear what is considered a form and what is a type of loan. We have reviewed loans in the most general and, in our opinion, the most meaningful form.

Thus, the role of loans varies at different stages of the economic cycle. In conditions of economic recovery and sufficient economic stability, loan acts as a growth factor. The redistribution of large monetary and commodity masses gives the loan of the subject additional assets. However, its negative impact can be reflected in conditions of overproduction. This effect is especially noticeable in conditions of inflation. New means of payment entering circulation together with the loan increase the already excessive amount of money needed for circulation.

Literature

1. Golyshev V.G. Transactions in the loan sphere / V.G. Golyshev. – M.: MZ Press, 2003 – 96 p.

2. Nikitin I.N. Veterinary clinic : textbook for universities / I. N. Nikitin, V. V. Ivanov, E. N. Trofimova. – St. Petersburg : Lan, 2020. – 184 p. : ill. – Text : direct.

3. Problems of competitive development of agricultural industries in the context of economic globalization/Assessment of the investment potential of agricultural industries: a collective monograph /N.-A.D. Avarsky, I.V. Voroshilova, I.V. Surina [et al.]/. – Krasnodar: KubGAU, 2014 – 270 p.

4. Djikovich Yu.V., Arefyeva A.A., Volnov E.E. Practical marketing: Textbook/ Edited by G.S. Nikiforov. – St. Petersburg: Publishing House «Lan», 2019. – 140 p. – (Textbooks for universities. Special literature).