The Iranian government has unveiled its long-anticipated scheme to give loans to home renters amid a housing crisis that has been exacerbated by the new coronavirus pandemic.
Iran’s Minister of Road and Urban Development Mohammad Eslami said on Wednesday that the government had earmarked an emergency budget of 200 trillion rials (nearly $1 billion) to fund loans aimed at renters across the country.
Eslami said the loans, which will be paid to landlords as a deposit for the property they let, will amount to 500 million rials ($2,300) for each tenant in the capital Tehran.
Banks will receive the principal of the loans directly from the landlords after the rent contract expires while the renters are supposed to reimburse an annual interest of 13 percent, he said.
A first announcement on the rescue measure was made earlier in the day during a Cabinet session led by President Hassan Rouhani.
“Paying the deposit loans to renters is a new step taken by the government in the difficult cronovirus situation,” said Rouhani while referring to the economic problems his administration is facing because of the pandemic.
Rouhani also said on Wednesday that his government had paid back some 320 trillion rials (nearly $1.5 billion) in arrears accumulated over the past 14 years to Iran’s Social Security Organization to help the body increase benefits and wages given to pensioners.
While grappling with a series of harsh and unprecedented sanctions imposed by the US, Iran has been battling one of the largest outbreaks of the new coronavirus in the world.
The government has offered billions of dollars in loans and grants to help the economy recover from the pandemic.