“Getting rid of the ballast”: how companies responded to the Bank of Russia’s record 21% rate

Demand is lower, costs are higher.

As businessmen told RB.RU, an increase in the tariff will lead to an increase in the cost of goods for end consumers.

“Prices in the markets will increase because many sellers work on credit. They take it for business development, etc., naturally the price of goods will increase,” comments RB.RU. AURET co-president Tatyana Gudina.

An increase in the key tariff by 200 points at once will likely lead to an increase in the cost of freight transportation, which, in turn, will again affect the end consumer, RB.RU confirmed. commercial director of EvoCargo Vasily Zhukov.

Along with rising prices, demand may decrease. As told to RB.RU founder of the company Siberian Bath Chan Dmitry LazarevAs rates rise, people become more cautious about their spending and may avoid additional debt obligations. It may not be profitable for companies to sell products in installments.

“Our clients sign an agreement with the bank to purchase bathtubs, but unlike standard loans, our company bears the cost of interest payments,” Lazarev said. “An increase in the rate will lead to an increase in our payment costs of the increased commission, the amount of which directly depends on the term of the payment plan, so short-term options may remain more profitable for both buyers and we”.

Founder of the Coddy online school Oksana Selendeeva claims that raising the interest rate to 21% will have a significant impact on its business as it will reduce customers’ purchasing power.

“Although we do not apply for loans, this change will reduce customers’ purchasing power and lead to higher prices. In conditions of instability, we definitely refuse loans, which will allow us to avoid financial risks and focus on sustainable development,” says Selendeeva.

Projects are postponed

General Director of Dsight Sergey Kantserov considers that an increase in the base interest rate could lead to a slowdown or even a freezing of loans for 6 to 12 months, in addition, in the medium term, the business sector could postpone plans to open new venture funds or even abandon them ; period.

Private companies that do not have preferential financing will be the most sensitive to changes in the cost of borrowed funds; An increase in lending rates will inevitably lead to an increase in production costs, he said. Head of the Project Management Department of NATEK-Neftekhimmash Igor Kamenev.

“For example, investment budgets in the oil refining, petrochemical and chemical industries take a long time to form; changes in the cost of equipment may lead to the postponement of the implementation of individual projects. As the cost of products increases, the competitiveness of Russian manufacturers vis-à-vis foreign suppliers will decrease,” says Kamenev.

Founder of Siberian baths Dmitry Lazarev He adds that an increase in the key rate will lead to an increase in the cost of leasing both assets and production equipment, which will increase the operating costs of the business.

“Leasing companies will be able to renegotiate the terms of the contracts by increasing interest rates, which will result in an increase in monthly payments. In addition, extending lease terms will be less attractive, as long-term lease contracts will have higher interest rates, which will complicate financial planning and increase the burden on the budget,” the businessman said.

Founder of Breffi, first president of the Equium business community, Evgeniy Gordeev He asks for the increase in the key rate to be understood taking into account what is happening in the country, but adds that, in this context, large projects will continue to be paused.

“In investment projects, entrepreneurs usually operate with the NPV indicator, that is, the net present value. This indicator is affected by the discount rate. If money is very expensive, then the project has an extremely low probability of being launched. Now many of our projects have shown a very small indicator or negative values ​​of the net present value indicator. This suggests that with such a high cost of money, they cannot be launched, which means that we keep them on pause, while we ourselves optimize the current business, look for how to make it cheaper and put things in order in the business. . “We “clean” and throw away the ballast so that we can exist in this current living space with the financial conditions that exist,” explained the businessman.

Business without loans

Businessmen believe that, in a context of rising rates, it is impossible to do without government support; Another way out of the situation could be greater digitalization.

“Without government support measures (preferential loans, subsidies), many companies will find themselves in a difficult situation, which could slow down the development of industrial sectors and create even greater risks for employment and the sustainability of the economy as a whole. “, says Kamenev of NATEK-Neftekhimmash.

EvoCargo’s Zhukov adds that in this context, for example, in freight transportation, the digitalization of logistics and the introduction of integrated autonomous solutions will become more popular, reducing costs. For example, companies can minimize costs by using a robots-as-a-service (RaaS) model.

Another opportunity that companies see is to adapt pricing policies and optimize and reduce costs.

“In response to these challenges, we will focus on increasing efficiency, optimizing internal processes and reducing costs to remain competitive,” says Coddy’s Oksana Selendeeva. “We will also adapt our pricing policy and improve customer service to retain existing students and attract new ones.”

An increase in the key rate will also affect fines and sanctions for companies, he recalled Chief Methodologist Expert of SberResolutions Ekaterina Boldina. The amount of fines (penalties, penalties), which are provided for, among other things, by labor and tax legislation, depends on the size of the key rate.

“Accordingly, with an increase in the key rate, the burden on companies to pay such payments as penalties for violation of contractual relations, compensation to employees, for example, for delays in wages, penalties for late payments increases. ​​​to the budget, the calculation of which is directly related to the key exchange rate,” said the expert.

At the same time, a high key rate allows those who have free funds to receive income. After all, when the key rate increases, not only the rates on borrowed funds increase, but also the rate on deposits, which means that you can place available funds at a fairly high interest rate and make money on them Boldina added.

New rate hikes and bankruptcies

The October rate hike is likely not the last. At the end of August, the Central Bank announced that it was allowing its increase to 22% in 2025. The regulator assumed that inflation would rise to 15% due to a significant reduction in the supply of goods and services. In a press release on October 25, the Bank of Russia allowed the interest rate to increase again in December. According to SberCIB analysts, a rate reduction cannot be expected before the second half of 2025. By the end of next year it could fall to 17%.

In October, banks lent to small and medium-sized businesses at a rate of 21%; after the key rate is raised, the cost of borrowing will increase, Sergei Aldonin, director of client relations at General Invest, told RB.RU.

“A high financing rate, on the one hand, forces companies to increase the prices of their products to maintain margins, on the other, high rates on loans to the population slow down demand,” said Aldonin;

According to the expert, companies with low business margins may be in a worse situation, since there is a limit to which the margin can be reduced for the business to be profitable. High interest rates on loans can also lead to a series of bankruptcies of companies with a high debt load, the expert concluded.

• The current increase is the third since the beginning of the year. Thus, the Central Bank increased the rate in September – from 18 to 19% annually, and in July – from 16 to 18%. At a December meeting, the Bank of Russia “admits the possibility” of a new rate increase.
• The Central Bank also raised its forecast for the average key rate for the period 2024-2026. It is expected that by the end of this year it will be between 21% and 21.3%, as follows from the updated macroeconomic forecast of the Central Bank of the Russian Federation.
• The forecast of the average key rate for the current year has increased from 16.9-17.4% to 17.5%, for 2025 – from 14-16% to 17-20%, for 2026 – from 10- 11% to 12-13%. . For 2027, the Bank of Russia maintained its forecast for the average interest rate between 7.5% and 8.5%.