Starting February 1, 2027, Georgia will tighten lending conditions for retail borrowers. The reform involves a ratio-based framework that imposes caps on monthly debt service payments.
The debt service ratio (PTI — Payment-to-Income) determines what proportion of an individual’s monthly income can be allocated toward servicing loan obligations.
While the 25% debt service ratio requirement has so far applied to borrowers earning up to 1,500 lari (around $580), under the new decision, this threshold will initially rise to 2,000 lari on February 1, 2027, and subsequently to 2,500 lari (approximately $770 and $960, respectively).
Under current regulations, an individual with a monthly salary of 1,600 lari can allocate up to 50% of their income—or 800 lari—to loan payments. Beginning in February 2027, this cap will be reduced to 25%.
The National Bank of Georgia explained that the changes are driven by “strong economic growth in recent years and the resulting rise in wages and other nominal indicators.”
“As a consequence, the existing fixed thresholds no longer adequately reflect the current income distribution of borrowers and their debt burden. If the PTI thresholds remained unchanged, borrowers moving from one income tier to another would be driven primarily by nominal income growth rather than by a genuine shift in their solvency or risk profile.
Accordingly, the revision of these thresholds is aimed at aligning PTI parameters with prevailing economic conditions and preserving the original stance of macroprudential policy. On this basis, the committee deemed it appropriate to recalibrate this macroprudential instrument.
At the same time, in order to avoid an abrupt one-off impact and distribute the effect over time, the committee decided to raise the debt service ratio threshold in phases. Specifically, whereas the 25% PTI ratio requirement previously applied to individuals earning up to 1,500 lari, this threshold will increase to 2,000 lari as of February 1, 2027, and to 2,500 lari as of September 1, 2027. This adjustment will help reduce the risks of excessive borrower indebtedness and support the resilience of the financial system,” reads the decision of the Financial Stability Committee of the National Bank of Georgia.