Georgia will tighten credit rules by gradually raising the income threshold under its 25% payment-to-income (PTI) rules — which set the maximum share of a borrower’s income that can be used for loan payments — to GEL 2,500, citing growth in average nominal earnings over the years while also seeking to address “over-indebtedness risks.”
Under the current rules, borrowers earning up to GEL 1,500 (USD 575) per month may use no more than 25% of their monthly income for loan payments. That threshold will rise to GEL 2,000 (USD 768) from February 1, 2027, and to GEL 2,500 (USD 960) from September 1, 2027.
For example, once the GEL 2,000 threshold takes effect, a borrower earning GEL 2,000 per month may use up to GEL 500, which is 25% of their income, for total monthly loan obligations.
Explaining the decision on September 30, the National Bank of Georgia (NBG) said the loan-service ratio thresholds were initially assessed using 2017 statistical data and updated in 2022 amid growth in “nominal economic indicators.”
“At the current stage, the need to recalibrate the thresholds of this ratio has arisen again,” the central bank said, pointing to “significantly” increased wages and other nominal indicators alongside economic growth in recent years.
As a result, “the existing fixed thresholds no longer adequately reflect the current distribution of borrowers’ incomes and debt burden,” the NBG said.
It added that if the PTI thresholds remained unchanged, “borrowers’ movement from one income category to another might be driven mainly by growth in nominal incomes rather than by a substantial change in their actual repayment capacity or risk profile.”
Accordingly, “updating the thresholds aims to bring the PTI framework into line with the current economic environment and to maintain the original stance of macroprudential policy,” the NBG said. It said the change will be introduced gradually “to avoid a sharp one-time impact” and spread its effects over time.
“Specifically, whereas until now a 25% payment-to-income ratio applied to persons with an income of up to GEL 1,500, this threshold will increase to GEL 2,000 from February 1, 2027, and to GEL 2,500 from September 1, 2027.”
According to the NBG, such an approach “helps to mitigate the risks of borrower over-indebtedness and supports the resilience of the financial system.”
‘Average Salary Approaching GEL 2,500’
Davit Utiashvili, Head of the NBG’s Financial Stability Committee, was quoted by the media as saying the current approach has been in place since 2018, “when the average salary was up to GEL 1,000, the maximum loan service threshold was set at 25% for persons with an income of less than GEL 1,000, and at 50% for those with an income of more than GEL 1,000.”
He added that “alongside income growth,” the threshold was raised from GEL 1,000 to GEL 1,500 in 2022.
“The average salary is approaching GEL 2,500, and we think it is time to raise the existing threshold from GEL 1,500 to GEL 2,500,” Utiashvili said.
“Our goal is to ensure that low-income households are not burdened with more debt than they can service without financial difficulties, including during periods of stress,” he added.
As of the second quarter of 2026, the average monthly nominal salary accounts for GEL 2,389.3 (before taxes), according to the National Statistics Office of Georgia (Geostat).
The NBG’s statement added that the bank “continues to monitor the country’s financial stability, to assess domestic and external risks, and, as needed, to use all instruments at its disposal to minimize potential risks.”
The Financial Stability Committee’s next regular meeting is scheduled for November 25, 2026.
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