Verband der Privaten Bausparkassen e. V. and CJSC Microfinance Company Elet-Capital signed a memorandum of cooperation

The memorandum is a confirmation of good will and expresses the intention of the Parties to cooperate in the field of the system of accumulation of savings for housing finance to individuals.

The parties agree to make every effort to develop cooperation in areas of mutual interest, and will inform each other about promising projects of mutual cooperation to strengthen mutually beneficial ties.

Chairman of the Management Board – Executive Director of CJSC MFC "Elet-Capital" (hereinafter-Elet-Capital) Ernest Kamchybekov noted the following:

"Housingе financeе in Kyrgyzstan is characterized by high cost and short term mortgage loans for the population due to the lack of sustainable housing financing system. Housing provision in the republic is the lowest among the CIS countries – 13 sq. m. per 1 inhabitant, with UN standards of at least 18 sq. m. per person in developing countries. We are pleased that Elet-Capital will be able to gain much-needed Bausparen experience directly from the Verband der Privaten Bausparkassen (Association of Private Bausparkassen) and implement it as an integral part of Elet-Capital's broad product line."

Christian Koenig, Managing Director of Verband der Privaten Bausparkassen e. V., Germany, said: "The Association of Private  Baussparkassen is committed to supporting Elet-Capital's sustainable growth plans to provide households in the Kyrgyz Republicе, especially in rural areas, with much-needed housing finance. We discussed with Elet-Capital the steps for further implementation of housing savings schemes “Bausparen” in Central Asia, especially in Kyrgyzstan. We have confirmed our commitment to fully realize the potential of Bausparen by signing a Memorandum of Cooperation. We view Elet-Capital as a strong partner interested in establishing and developing the Bausparen housing finance system in Kyrgyzstan."

About Elet-Capital

Elet-Capital started its operation on September 29, 2005 as a micro-credit company that supports micro and small businesses in Kyrgyzstan.

Currently, the Company is a micro-finance company established in the form of a Closed joint-stock Company and operating in accordance with the legislation of the Kyrgyz Republic, with a loan portfolio of more than $ 3 billion. soms and almost thousands active clients, 50% of whom are female borrowers. Elet-Capital is one of the four largest microfinance companies in Kyrgyzstan and has a wide regional network 23 branches and 2 representative offices, which employ more than 280 employees. The accumulated successful experience of financing, implementation of international practices and continuous improvement of business processes, responsible attitude to customers enabled Elet-Capital success.

February 14, 2023 Elet-Capital announced the first issue of corporate bonds totaling 90 million Kyrgyz soms. By the decision of the Listing Committee of Kyrgyz Stock Exchange CJSC (KSE), the Company is included in the Official KSE List (listing) in category “B” (next to the highest).

About the Bausparen Housing Finance system

At the heart of Bausparen is the idea of “help for self-help", where a group of people come together and agree to contribute a certain amount to a common savings fund on a monthly basis for housing financing of participants in the system. Bausparen is a closed system that does not depend on capital markets and their fluctuations. The Bausparen system has been operating in Germany and other European countries for more than 100 years and has proven to be extremely viable and socially significant in improving the provision of housing for the population, especially its socially vulnerable strata. In Germany, about 60% of all property buyers use bauspar funds;the contract sum in the bauspar system amounts to about 930 billion euro. Every fourth member State of the European Union is a bauspar country, and bauspar laws apply in the following countries:

  • Germany (since 1885),
  • Austria (1925),
  • SlovaksI (1992),
  • Czech Republic (1993),
  • Hungary (1997),
  • Romania (2004),
  • Croatia (1998) and
  • Kazakhstan (2003)

In addition, bauspar contracts have been offered for a long time in Luxembourg and China without a specific bausparkassen law.

The Verband der Privaten Bausparkassen e. V. (Association of Private Bausparkassen) represents all 9 private bausparkassen companies in Germany. Its main mission is to represent the interests of its member institutions and their more than 15 million clients before supervisory authorities and government agencies. For bausparen clients, the Private Bausparkassen Association is also the contact person and source of information for all matters related to bausparen.