“Entrepreneurs are increasingly informed and responsible about investing” – Daniela Crețu, Office Coordinator at Microinvest

Whether you are an entrepreneur or an individual, investing is an important step in managing your budget. You can save up for a long time to eventually make an important purchase for yourself or your business with your own capital, or you can use borrowed capital, simply put, loans, and reach your goals when the time comes. Both strategies have their advantages and disadvantages, but for both, business and family budgets, the secret is to make financing decisions with the proper information.

At Microinvest, in addition to providing financial services, we strive to contribute to the financial education of society as a whole. Every year, we participate in international campaigns aimed at raising public awareness of the importance of proper money management, one of them being Global Money Week, a campaign that takes place simultaneously in more than 160 countries around the world. This year, together with our colleague Daniela Crețu, Branch Coordinator, we decided to touch upon the topic of responsible lending for business and personal needs.

Daniela, you have been a part of the Microinvest team for more than 7 years. In the beginning, you were a Loan Expert, and then you were promoted to Coordinator. How has your perspective on lending and investing evolved during this time?

Before joining Microinvest, the topic of loan was taboo for me. Neither I nor my family had loans, but I often heard that they should be avoided. Unfortunately, for some people, due to negative experiences or lack of information, taking out a loan always means getting into trouble. When in reality it can be quite different. At Microinvest, my attitude towards lending has changed dramatically. While I was still a student, I applied for the Induction Program for Loan Experts. It was during this program that I began to understand what responsible lending is and the real purpose of the loans offered by Microinvest. I understood why it is important to have a good credit history, to be able to objectively assess your ability to pay, what the loan is and how it is calculated, and most importantly, how to manage it properly.

How important are loans in everyday life? And when it comes to entrepreneurship?

There is no doubt that loans are very important, especially for businesses. Throughout my 7 years of work, I have had the opportunity to interact with many entrepreneurs and individuals who utilize loans as an effective tool to achieve their goals. In everyday life, there are things that we may need immediately but would take years to save up for, such as a house, a car, repairs, equipment, and more. A well-considered loan, matched correctly to monthly income, can help improve living conditions for a family today by allowing gradual repayment. In business, borrowed capital is essential for growth: it can be invested in working capital, equipment, or other investments that accelerate growth significantly. This is particularly crucial for businesses. The key is to be well-informed before applying for a loan.

What should you pay attention to when choosing a loan? Tell us briefly about the meaning of the most important financial terms in the loan agreement.

The first thing to think about before applying for a loan is whether you can afford it. It sounds abstract, but loan is a responsibility that can only benefit you if you manage it properly. Of course, the most important loan term is the interest rate, and not just any interest rate, but the EIR – the effective interest rate. Even if it seems complicated, at Microinvest we always explain every component of the loan to our clients, so that they clearly know what they are paying and how much they are paying. Another important term in lending is collateral. Not all loans require collateral. For example, at Microinvest individuals can get a loan up to 300,000 MDL without collateral, while for entrepreneurs the maximum amount without collateral is up to 3,500,000 MDL. The client should realize that collateral entails additional expenses and requires the collection of several documents from different sources, which makes the lending process slower and less comfortable. I would like to mention that attention should be paid to the currency in which the loan is granted. Often clients are not aware of the currency risk. It is better to take a loan in the currency in which you earn your income, to make it easier to pay and avoid the risk of exchange rate changes.

What is Microinvest’s approach to community financial education?

Microinvest is the only financial institution in Moldova that has the international GOLD certificate in the field of client protection. For us, this certificate is not just a mention, but a mission. Even if not all clients realize it, there are situations when refusal to grant a loan is the most correct and objective decision for both parties at that moment. Our cooperation with clients is transparent. Loan Experts communicate directly with each client, conduct a detailed financial analysis of the business, explain each stage in detail, so that the lending decision made has a positive impact on the business. Microinvest also regularly organizes events about financial education for children, youth, clients, partners and entrepreneurs. In my experience, modern society is moving in the right direction, our clients, both individuals and legal entities, are becoming more and more aware, making informed decisions, understanding the ins and outs of lending, and realizing that both credit history and purpose are important for getting a loan. Most importantly, I am proud that we are making a direct contribution to the financial education of our clients and society as a whole.

Besides being a Branch Coordinator, you’re also a young mom. When and how should parents start talking to their children about money? How do you involve them in managing the family budget?

Financial education should start, first of all, at home, as soon as the child begins to understand that each family member has certain needs that can be met by buying certain goods. For this to happen, we adults must first of all be financially literate ourselves and foster this sense of responsibility in our children. I do this with my young son: every time he asks me to buy something, I give him a certain amount of money and explain how to distribute it – how much can be spent on current desires, how much to put aside for a future big purchase, for example, an expensive toy, and how much should be put aside for savings. When the children grow up, we will also explain what a loan is, why a large amount of money is taken, and that it is important to set aside a certain reserve every month to repay it. Most importantly, children should understand the value of money, that it is not just a piece of paper, but a resource acquired as a result of labor. This should be discussed both at home and at school, because only in this way children will grow up to be responsible adults who realize their actions and their impact on their lives and its quality.

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Client's Name
Client's Surname
Personal Identity Number
Currency
Term
Rate
Amount
Monthly payment
Amount to receive
Purpose
Comments

1. Name and Contact Information of the Creditor
Creditor
Address
Phone number
Email Address
Web page

3. Costs of the credit
Rates related to the credit
Annual Percentage Rate of Charge (APR) This is the total cost expressed as an annual percentage of the total amount of credit. The APR is there to help you compare different offers	%
In order to obtain the loan in accordance with the agreed terms and conditions, it is mandatory to conclude an insurance contract to guarantee the loan or a contract for another ancillary service.
Related costs
Any other costs deriving from the credit agreement	Fee for services rendered in relation to usage of credit, calculated and paid as follows: of the credit and paid by the Debtor on the date of granting the credit from own sources or is deducted by the Creditor from the amount of the credit The negotiation / prolongation of the credit can take place by mutual agreement of the parties, by signing an additional agreement, the Creditor being entitled to request an increase in the interest rate within the limits provided by the legislation in force. In case of negotiation / prolongation of the loan, the Borrower shall pay to the Creditor, at the date of the negotiation / prolongation a commission in the amount of 2% from the credit balance at the time of negotiation / prolongation.
Conditions under which the costs related to the credit agreement can be changed	The Sides can change the costs related to the credit by written agreement signed by both parties; For the non-constitution of the guarantees within the agreed term, the Creditor is entitled to calculate, and the Client will pay to the Creditor an Interest of delay in the amount of 5% annually, applied to of the daily balance for each day of delay, starting with the date following the term established for the constitution of the guarantee/ s and until the date of the proper execution of the respective obligation.
Obligation to pay for notarial fees / mortgage registration fees / fees for noting the prohibition of pledge in the Transport Register related to the pledge of means of transport (agricultural machinery)	Paid by the Client , except as otherwise provided in the pledge / mortgage agreement.
The cost for the valuation of real estate proposed in pledge	Paid by the Client directly to the Evaluator
Costs in the case of late payments Missing payments could have severe consequences for you (e.g. forced sale) and make obtaining credit more difficult
The repayment of the loan is free of charge in the secondary offices of the Creditor, as well as at the discretion of the Debtor through the representatives authorized to collect loan payments. The list of which and their fees are published on the website of the Creditor (www.microinvest.md/cum-achiti-creditul/). In case the Debtor use payment methods with fee, the Debtor cover all the costs of repayment of the loan and undertake to make the payments in such a way that the Creditor receives the agreed repayment amount and without any deductions by third parties processing the refund payment.
In accordance with and arising from the provisions of art. 15, para. 7), lit. a) from Law no. 202/2013, any payments related to the granted credit (commissions, taxes, penalties, late interest and any other type of payment), except interest, will be applied and collected within the limit of the ceiling of 0.04% of the total value of the credit per credit day multiplied by the number of days of actual use of the credit (hereinafter 'Ceiling'). Therefore, the Lender will be entitled to apply and collect the costs, excluding interest, exactly in the fixed or percentage amount established in the contract if the said ceiling allows, and if the ceiling is lower than the value of at least one cost, excluding interest, then the Lender will be entitled to reduce the fixed/percentage amount and apply and collect any of the applicable costs only within the limit of the ceiling value. When calculating the ceiling, the costs already applied and collected will be taken into account, with the exception of interest, which reduces its value. (Representative example: if the amount of the penalty is 20 MDL per day, and the ceiling value at that time is 16 MDL, then a maximum of 16 MDL will be collected).

4. Other important legal aspects
Right of withdrawal You have the right to withdraw from the credit agreement within a period of 14 calendar days	Yes
Early repayment You have the right to repay the credit early at any time in full or partially	Yes
The creditor is entitled to compensation in the case of early repayment The Debtor may repay the loan in full or in part in advance, notifying the Creditor in writing 3 days in advance, and paying an early repayment fee of:	% from early repaid amount, if the period of time between the date of early repayment and convened maturity exceeds one year; % from early repaid amount.The early repayment can be made only if the Debtor has no outstanding debts on interest or other amounts to be paid in accordance with the Contract. % from early repaid amount, if the period of time between the date of early repayment and convened maturity does not exceed one year.
Database usage The creditor must inform you immediately and without charge of the result of a consultation of a database, if a credit application is rejected on the basis of such a consultation. This does not apply if the provision of such information is prohibited by law or is contrary to objectives of public policy or public security The parties may agree on additional terms and conditions, which will be included in the credit agreement.	Yes
Right to a draft credit agreement You have the right, upon request, to obtain a copy of the draft credit agreement free of charge. This provision does not apply if the creditor, at the time of the request, is unwilling to proceed to the conclusion of the credit agreement with you	Yes
The period of time during which the creditor is bound by the pre-contractual obligations	This offer is valid for 15 calendar days after it is issued.
In this regard, I subsequently declare that: I was provided with the necessary information, the essential characteristics of the above-mentioned credit product were explained (interest rate, number of commissions, credit costs, early repayment conditions, total amount to be paid), as well as the consequences of non-compliance with contractual clauses; the costs included in the total cost of the loan were explained to me, including the costs for ancillary services related to the credit agreement; I was offered the possibility to negotiate individually the contractual clauses in the credit agreement that I intend to sign, I negotiated individually the granting commission, the monthly commission, the amount of penalties and I mention that its clauses do not disadvantage me, being fair in the report mine with the creditor; I was asked by the creditor about the probable importance of the information provided and whether essential circumstances that I expected to be provided were not omitted in order to make an informed and rational decision about concluding the potential credit agreement. the information provided and the corresponding explanations allowed me to assess, including the personal analysis of other offers of third party creditors, whether the proposed credit agreement is tailored to my needs and financial situation; I know the content of the contract and all its conditions have been explained to me, I have understood and accepted them, and the documents and information underlying the conclusion of the contract are complete and accurate; I know the law, the normative acts that will govern the contract, as well as the lack of consumer quality; I have no ambiguities or misunderstandings regarding the terms of the contract; the credit product corresponds to the purpose described above and will be used according to the destination and the economic activity carried out. The assets procured/resulted/constructed/repaired from received loan sources will be registered/transmitted in the social capital of the company where my business activity is carried out and/or will be used jointly by the members or individually however strictly for running my business activity. (Signature)