GENERAL TERMS AND PROVISIONS OF LOAN AGREEMENTS 1 GENERAL PROVISIONS 1.1 Clients of Horizonti A client of Horizonti can be any natural person, an adult citizen of the Republic of Macedonia who meets the general and special terms and provisions for loan approvals. 1.2 Identification and follow up of clients Identification is carried out exclusively with a valid document (identity card or passport) issued by the competent authorities. The client, in accordance with the loan agreement, is obliged to notify Horizonti about any change in personal or other data, in particular for changing the place of residence or change of the contact phone numbers that were relevant at the time of signing the contract. 1.3 Personal Data Protection The client and any other person, who in any way guarantees loan repayment in accordance with the Law on Personal Data Protection and the Credit Institutions Act, shall provide data that Horizonti may use in the process of approval or collection of the loan, and they are considered a business secret. The client and others to approve that the personal data shall be shared with the Macedonian Credit Bureau, the state bodies to which it is legally obliged, as well as with third parties with whom Horizonti have concluded a special agreement for data transfer. Horizonti will collect, process, store and transfer the personal data of the client and others for the purpose of: making a credit decision on a loan application, loan collection, promotional purposes, research to improve the services of Horizonti and other legitimate purposes as prescribed by the Law on Personal Data Protection, other legal acts, and in accordance with the internal acts of Horizonti. The Client has the right to access the personal data he has given for the above purposes, and to seek rectification in case they are incorrect. 1.4 Foreign currency clause in loan agreements (individual loans) Depending on the loan product and maturity, individual loan agreements are formed with a protection clause against devaluation of the denar against the euro (Article 3). This is because the sources of funding of Horizonti come from foreign creditors and are expressed in Euro currency, and they insist on such protection. When activating this clause, Horizonti have no obligation for a written notice to the client. 1.5 Protection of rights and interests of the clients Horizonti undertakes that in the pre concluding stage of the Loan Agreement, it shall inform the client verbally and in writing of the rights and obligations that may arise from the Loan Agreement and other loan related acts. Horizonti shall ensure protection of the rights and interests of the client (at all stages of the operation) through the adoption and consistent application of the Code of Conduct with Customers, the Code of Conduct on Collection and other acts, which will be in accordance with the legal regulations and are based on good business practice, fair and honest relationship with the client. 1
2 APPROVAL AND PAYMENT OF THE LOAN 2.1 Approval of the loan The clients can obtain information on the conditions and necessary documentation for loan approval from the employees of Horizonti. A loan may be approved solely on the basis of a written request (application) from the client. The examination of the application is conditioned by the provision of all necessary documentation, in accordance with the prescribed acts of Horizonti. Clients must be informed about the credit decision. Before concluding the loan agreement, Horizonti is obliged to notify the clients of all terms attached to the loan agreement. Clients will receive this information verbally by employees of Horizonti as well as in writing under the General Terms and Provisions for Loans and the Information Sheet on the conditions and loan costs. 2.2 Payment of the loan Payment of the proceeds of the loan shall be made upon signing of the agreement between the client and Horizonti. It is performed exclusively on a (denar) transaction account of the client opened in any of the commercial banks. 3 INSTRUMENTS FOR SECURING THE LOAN As eligible instruments for securing loans, Horizonti use: Guarantors through an administrative ban on wages An ordinary bill of exchange Bill of exchange in which the rights and obligations of the signatories are regulated by a notarial act The client shall cover all costs associated with securing the loan. 4 CONTROL OF PROPER USE AND MONITORING OF THE LOAN 4.1 Control of proper use The borrower is obliged to use the loan in accordance with the purpose stated in the contract and other documents relating to the loan and to provide evidence to Horizonti. If the borrower is not able to use the loan in accordance with the purpose specified in the agreement and other documents, he shall be obliged to repay the approved amount in full with the interest due and other expenses in accordance with the internal policies of Horizonti. If during the term of the loan agreement, Horizonti finds that the loan has not been used in accordance with the agreement and other documents, it has the right to terminate the contract and request the client to fully repay the loan together with the arrears and other costs in accordance with the internal policies of Horizonti. 2
4.2 Monitoring of loans During the period of the loan agreement, Horizonti reserves the right to regularly monitor the client, which can be performed as follows: Telephone contact before maturity in repayment rates Visit to the workplace or place of residence 5 PAYMENT OF LOANS 5.1 Regular repayment Repayment of loans is performed according to loan repayment plans. If repayment of installments is due in a non working day, the repayment is shifted for the first subsequent business day. Loans are repaid in denars at any Horizonti branch office. The client can make loan repayments directly to Horizonti s bank account through any of the commercial banks, only with prior approval by Horizonti. For each payment made at the Horizonti branch office, Horizonti is obliged to issue a receipt to the client as a receipt for paid funds. If the repayment installment is not paid in full on the due date, the loan will be considered delayed. 5.2 Early repayment of loans The client is entitled to make payments under the loan agreement prior the agreed deadline early repayment of the loan, and the following applies: In the case of individual loans, the total remaining debt includes unpaid principal and outstanding interest and compensatory controls charged to the date of repayment. The remainder of the non settled principal is calculated and charged for an early repayment commission, according to the tariff of Horizonti. In the case of group loans, the total outstanding debt that includes the outstanding principal and a default fee in amount of unpaid interest rates and management fees as follows: The agreed interest and interest rate charges when the prepayment date is less than 5 months, and 4 outstanding installments of agreed interest and management fees, when the repayment date is up to the expiry of the loan for more than 5 months. 5.3 Consequences and obligations in cases of late payment For each day of delay of payment Horizonti shall calculate and charge penalty interest on the amount of due and outstanding principal, in line with the Law on Obligations. The delay in repayment of the loan is recorded in the Macedonian Credit Bureau, which further affects the client s ability to borrow funds from another institution. Forced collection of the loan through one of the instruments for securing loans. 3
6 INTEREST AND OTHERS COSTS The total annual cost of the loan is expressed through the RTC (Rate of Total Costs) and calculated in accordance with legal regulations. 6.1 Interest rate The principle of lending in Horizonti is with fixed interest rates and other charges. This means that there is no risk for the client to suffer any change of interest rate and possible increase of the costs of the borrower for the duration of the loan agreement. 6.2 Costs for processing the loan These costs include: Application costs. Fixed cost payable at the time of application. These costs are charged regardless of whether a loan is approved or not. Fee for administering the loan application and payment. It is calculated and charged only on individual loans once before the loan is paid as a percentage % of the loan amount. 6.3. Costs for management of loans Management fee. It is calculated as a % of the total loan amount, and it is denoted for all monthly installments. 6.4 Other costs for individual loans Other costs include: Early repayment fee. It is charged solely to individual loans in case the client wants to full repayment of the loan before the agreed deadline. The commission is calculated as % of the amount of the outstanding principal of the loan. Revaluation cost, which refers only to certain products that have a currency clause in loan agreements. This cost is calculated and charged only with a special decision brought by the management of Horizonti. 7 AMENDMENTS TO THE LOAN AGREEMENT All amendments to the loan agreement must be in writing, signed as an annex to the loan agreement, and should be first approved by both contracting parties. 4
8 TERMINATION OF THE LOAN AGREEMENT In the event the client fails to comply with the agreed terms, Horizonti reserves the right to terminate the loan agreement. In the event of termination of the loan agreement, Horizonti may require forcible collection of claims by the client or the guarantors. In this case, Horizonti reserves the right to choose and order the activation of the collateral instruments. Prior to activating the credit security instruments, Horizonti will notify the client and the guarantors in writing. 9 INFORMING AND COMMUNICATING WITH CLIENTS Horizonti communicate with clients and individuals who in any way guarantee repayment of the loan over the phone, through personal contact or in writing. All information, for which written notice has been agreed, shall be deemed to be duly delivered, if it was sent to the last registered address of the client/guarantor. 10 RIGHT TO APPEAL The client or the person responsible for loan repayment on any ground, has the right to appeal if he considers that Horizonti do not comply with the good business practice, and in accordance with the contractual obligations. Horizonti are committed to answering each complaint within 30 days of filing the complaint. The complaint is submitted in writing to the address(es) of Horizonti, via e mail, or personal delivery to the branch offices, indicating that it is a complaint. The complaint can be filed using a complaint form or in the template requested by the client. The complainant is obliged to indicate his/her name and surname, address, a brief explanation of the complaint that by the client s opinion is within the time limit for the foregoing reasons stated, and the time and place of the dispute, if relevant. Within the complaints, clients may state any suggestion or opinion on how to overcome or solve the problem. Anonymous complaints are not being considered. 5