Russia’s first personal bankruptcy law came into force on October 1 – a development that is expected to result in a wave of legal action by Russians who are struggling to pay back loans.
According to the new law, which was signed in 2014 by President Vladimir Putin, Russians with debts of more than 500,000 rubles (about $7,600) that are more than 90 days overdue can now declare themselves bankrupt.
Russia previously had allowed companies to declare themselves bankrupt but not individuals.
Russian banks had encouraged people to take out loans and mortgages during prosperous years of high oil prices and before international sanctions were imposed against Russia over its illegal annexation of Crimea and its role in Ukraine’s civil war.
Many are now struggling to pay back what they borrowed – especially those who took out loans denominated in foreign currency before the value of the ruble plummeted in 2014.