Minister of Social Affairs, Malek Zahi, recently disclosed a series of measures in a press conference, which incorporates an increase in loan amounts available to members of the National Fund for Retirement and Social Security and the National Fund for Social Security. These loans will feature interest rates lower than those presented by public banks. This development has sparked debates concerning its potential effect on the banking sector, especially concerning whether it might prompt banks to reassess their interest rates, which some deem excessively high.
In reaction to these concerns, financial analyst and specialist Samir Raqiq highlighted to Tunisie Numérique the structural financial imbalances encountered by both the National Retirement and Social Security Fund and the National Social Security Fund. These issues have led to a notable deficit for these public institutions, surpassing 5.7 billion dinars by the end of 2023.
Raqiq remarked that the initiative by the Minister of Social Affairs to permit social funds to resume financing for their subscribers will have an immediate positive effect by providing more accessible loans compared to those offered by banks. Nevertheless, he pointed out that these loans will not drastically facilitate conditions for borrowers, as the interest rates for these loans are predicted to be around 8.25%, slightly lower than the banks’ rates, which hover around 10%. He likewise mentioned that the amounts provided by banks greatly exceed those offered by social funds, with bank loans to people amounting to about 40 billion dinars, or about 30% of the total loans in the banking sector.
Consequently, Raqiq believes that the loans from social funds are unlikely to significantly impact the banking sector’s operations, particularly in the realm of personal loans.
Concerning the potential for banks to revise their interest rates, he asserted that bank rates are fundamentally distinct from those of social funds because they are connected to the cost of money, which differs from the funds that social institutions manage on behalf of their members. He explained that the higher rates charged by banks on loans, typically about 10 to 11%, are employed for savings operations and other financial activities, indicating that the introduction of loans by social funds is not expected to impact the banks’ lending activities or their interest rate policies directly.
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