‘‘Forintisation’ is also an option’

Minister of National Economy Mihály Varga wants foreign currency loans to be converted into Hungarian forints, reports Magyar Hirlap. The goal of the initiative is to re-establish a measure of “social justice”.

Since the early 2000s, many Hungarians have taken out loans in foreign currency (mainly in euros and Swiss francs). However, with the onset of the economic crisis in 2008, the value of the Hungarian forint relative to these currencies has sharply declined, and borrowers today are often faced with the obligation to reimburse sums in forints that are higher than those originally borrowed and which are also subject to increased interest rates.

The government declared that “forintisation” should be administered by Hungary’s banks, while adding that the plan would only concern people who had taken out property loans.