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Law on Deposits, Loans, and Banking Transactions in Mongolia

This law regulates deposits, loans, and banking transactions in Mongolia.

Chapter One: General Provisions

  • The law regulates deposits, loans, and banking transactions in Mongolia.
  • A bank is defined as an institution that accepts deposits and provides loans to customers.
  • The Mongolbank is the central bank responsible for regulating and supervising commercial banks.

Chapter Two: Deposits

Deposit Types

  • Deposits are classified into two types:
    • Savings deposits
    • Current accounts

Deposit Terms

  • Banks must clearly indicate the terms of deposits, including interest rates and maturity dates.
  • Interest on deposits shall be calculated in accordance with the loan agreement and cannot exceed 20% per annum.
  • If a deposit is not paid within the specified time, default interest may be charged.

Chapter Three: Loans

Loan Types

  • Loans are classified into two types:
    • Secured loans
    • Unsecured loans

Loan Security

  • Assets provided as security for a loan shall be registered in the State registry of Immovable property.
  • If a borrower fails to repay a loan, the lender has the right to sell the assets provided as security.

Chapter Four: Loan Guarantees and Security

Guarantee Obligations

  • A guarantee is an obligation taken by a third party (guarantor) to repay a loan in case of borrower’s inability to repay.
  • The guarantor shall carry out its obligations in accordance with the law and the loan agreement.

Asset Security

  • Assets provided as security for a loan may include:
    • Private houses
    • Immovable property
    • Goods
    • Securities
    • Other assets

Chapter Five: Other Provisions

Liability for Breach of Law

  • Liability for breach of the Law on Deposits, Loans, and Banking Transactions includes criminal and administrative responsibility depending on culpability, nature of offense, and amount of damage caused.
  • Penalties for breaches include fines ranging from 5,000 to 200,000 togrogs (Mongolian currency).

Note: This is a translation and may not be an exact representation of the original text.