Economy, Business And Markets

Uncertified Institutions Warned Anew

Uncertified Institutions Warned Anew Uncertified Institutions Warned Anew

The deputy governor of the Central Bank of Iran has warned people against depositing in unauthorized financial and credit institutions which are offering high deposit rates, expressing the CBI’s determination to tighten supervision over the implementation of new interest rates set by the Money and Credit Council.

The MCC has lowered the cap on deposit rates from 22 percent to 20 percent and decreased lending rates to 24 percent from a previous range of 27 to 28 percent.

Hamid Tehranfar said he believes that the unauthorized institutions usually face unmanaged risk as they are involved in highly risky financial activities in an effort to pay higher deposit rates, a process expected to also endanger depositors, ISNA reported.

“In case of defiance, the offenders would be indicted for causing disruption in the economic system and would face penalties,” the official said, expressing hope that all institutions will adhere to the limits and take the CBI’s warnings seriously.

Tehranfar argued that the new cut in the interest rate will boost investment. He said the new lending rates are more compatible with the rate of return in the real economy and they would help banks better finance the manufacturing sector, a move that would lead to decline in consumer prices.