Ukrainian banks have filed a record number of lawsuits against debtors this year: how to borrow money correctly
24 December 16:24
In 2025, Ukrainian banks were much more likely than in the previous year to settle their relations with their debtors in court. For borrowers, both current and potential, this is a reason not only to objectively assess their ability to service the loan, but also to think about how best to protect their financial rights if necessary. What should a borrower keep in mind – "Komersant Ukrainian" found out.
This year, Ukrainian banks filed more than 100 thousand lawsuits against debtors. For comparison, last year there were significantly fewer such claims – 84,261. This statistic was cited by the Opendatabot platform in December, citing data from the State Judicial Administration of Ukraine. This year’s figure of more than 100,000 lawsuits was called a record for the last seven years. In total, since 2019, the courts have received 511,865 lawsuits against those who owe money to banks. And for the record, more than 70% of all this year’s lawsuits are against Universal Bank/Mono, A-Bank, and PrivatBank.
This bank claim statistics does not include data on the results of such debt settlements. The other thing is that these and other conflicting loan histories could have been avoided. Moreover, the borrower has opportunities to protect his or her rights and interests.
The first line of defense
In search of financial support, Ukrainians most often turn to banks or microfinance organizations (MFIs). As Zoryana Zachepilo, a lawyer at Zakhyst Law Firm, explains, the main difference between banks and MFIs is the cost of a loan, the level of customer verification, and the degree of financial risk. Banks offer more stable and transparent conditions, while microfinance organizations compensate for the availability of loans with high interest rates. But in both cases, in order to receive funds, you need to sign a contract. And this is where the first-obvious, but quite important-line of defense lies. Lawyer Zoryana Zachepilo continues:
“First of all, you need to carefully read the agreement and, in particular, the provisions on the interest rate, maturity, fines, penalties and additional fees. It is necessary to pay attention not only to the promotional interest rate, but also to take into account the total amount of funds to be repaid under the agreement. In addition, the borrower should find out in advance the amount of penalties in case of late payments and the possible consequences of default,” the expert notes.
Zoryana Zachepilo also says that before entering into an agreement, it is advisable to check whether the bank or microfinance organization has a license in the official register of the NBU.
“And one more piece of advice: the borrower should keep copies of the agreement, payment documents and electronic confirmations that can be used to protect his or her rights, if necessary,” the lawyer emphasizes.
Between rights and obligations
The borrower has rights. For example, to receive full information about the terms of the loan. In the event of unclear wording or additional paid services, the borrower has the right to demand clarification. Or refuse to enter into the agreement altogether. Which is often not the worst option. The borrower also has the right to early repayment of the loan.
The borrower has one main obligation – to repay the loan and interest on it in a timely manner. But if, for example, the loss of a source of income, deterioration in health or other life circumstances prevent you from fulfilling this obligation, what should you do? As Zoryana Zachepilo, an attorney at Zakhyst Law Firm, emphasizes, current Ukrainian legislation contains mechanisms to protect borrowers’ rights, but only if they are applied in a timely and correct manner.
“First of all, a person facing difficulties in fulfilling loan obligations should analyze the terms of the loan agreement, including the procedure for calculating interest, fines and penalties, as well as the provisions on the liability of the parties. It is important to record the circumstances that make it impossible to repay the loan in a timely manner, as such evidence may be used in negotiations with the lender or in court proceedings. Ignoring the creditor’s requirements or attempting to resolve the situation on your own without proper legal assessment often leads to a deterioration in the borrower’s situation and an increase in the amount of debt,” the expert states.
The question logically arises: when exactly and under what circumstances should you contact a lawyer? Zoryana Zachepilo answers.
“Applying to a lawyer is justified in cases of significant debt, systematic accrual of penalties, violation of the borrower’s rights by banks or collection companies, receipt of court subpoenas or the initiation of enforcement proceedings. It is professional legal assistance that allows you to assess the legality of the creditor’s actions, formulate an effective legal position, initiate negotiations on debt restructuring or ensure proper protection of the client’s interests in court. Practice shows that timely involvement of a lawyer significantly increases the chances of minimizing financial losses and preventing illegal methods of debt collection,” the lawyer emphasizes.
In today’s banking practice, there are more and more situations when a borrower receives an unexpected offer to “close” a loan by paying only 50% of the outstanding balance. This raises natural questions: why does a financial institution agree to significant concessions and does such an offer contain hidden risks or traps? Zoryana Zachepilo explains.
“The answer should be found in the mechanisms of bank risk management. When a bank issues a loan, it is obliged to form an appropriate financial reserve – the so-called “reserve for possible losses”. The higher the risk of loan default, the higher the amount the bank has to reserve, which affects its profitability. Therefore, sometimes it is more profitable for a bank to receive a partial repayment than to keep a problem asset on its balance sheet with a constant burden on provisions. An analysis of court practice shows that in cases where the borrower has paid part of the debt based on a written offer from the bank or an additional agreement, the courts recognize the obligation as terminated in accordance with Article 604 of the Civil Code of Ukraine,” the lawyer notes.
But it’s not that simple. There are several important things that should protect the interests of the borrower in such situations. Zoryana Zachepilo, a lawyer, tells about them below.
“First, it is important to record agreements in writing. That is, everything agreed with the bank regarding the terms of partial repayment must be in writing (letter, additional agreement), in accordance with the requirements of the Civil Code of Ukraine. Second, the wording of the agreement must be clear. For example, the document should state that upon payment of a certain amount, the obligation is considered fully terminated and the balance of the debt is not subject to collection. Before entering into the agreement, you should also make sure that the right to claim the loan has not been transferred to a third party. And finally, you need to have proof of fulfillment of the obligation: after paying the agreed amount, you need to obtain an official bank certificate stating that there is no debt,” the expert emphasizes.
It is worth emphasizing once again: in the absence of proper documentation, there is a risk of further claims from the creditor. And, as Zoryana Zachepilo notes, court practice confirms this.
“As an example, I will cite case No. 761/31213/20, when the Shevchenkivskyi District Court of Kyiv refused to recognize the borrower’s loan obligation as terminated, as he could not provide any document certifying the bank’s consent to close the loan by paying part of the debt. The court concluded that in this case, the original agreement remains in force, and the remaining amount is subject to recovery in the general procedure,” the lawyer said.
In other words, the absence of official confirmation of the fulfillment of the obligation creates a real risk of fraud or manipulation by the lender. A borrower who has paid part of the debt and is tempted by the bank’s verbal promise to “write off the rest” may be left without legal grounds to consider the loan closed and may face repeated demands for payment of the balance, fines or penalties in the future.
Non-standard situations
Many clients of Ukrainian banks, including those who had no plans to obtain a bank loan, have probably heard a bank employee offer to use card credit limits more than once. As you know, a credit limit is a form of consumer lending that provides for the bank to grant the borrower the right to use funds within the established limit. And those who accept such proposals may face non-standard credit obligations.
As noted by attorney Zoryana Zachepilo, such situations are increasingly common in the legal practice of Zakhyst Attorneys at Law.
“Unlike classical consumer loans, a credit limit on a payment card is often granted and issued without signing a separate written loan agreement. In practice, banks are limited to the following: a customer application form; banking service rules; internal tariffs posted on the bank’s website. At the same time, the essential terms of the loan, including the interest rate, the procedure for calculating interest and penalties, are often not properly agreed with the borrower in writing. As a result, interest and penalties are accrued without written approval; unilateral changes in tariffs by the bank; collection of penalties after the termination of the actual loan relationship; and claims that significantly exceed the amount of funds actually received. Accordingly, such actions of banks become the basis for litigation,” says the expert.
According to her, since 2018-2019, the Supreme Court has repeatedly emphasized in its decisions that: general terms and conditions, tariffs and service rules cannot be automatically considered agreed with the borrower without proper evidence.
“The court practice of recent years shows that the requirements for proof on the part of lenders have been tightened and that it is impossible to recover from the borrower amounts that have not been properly agreed in writing. Accordingly, the courts are increasingly ruling to limit the creditor’s claims to the amount of funds actually received (the loan body) or to refuse to recover penalties,” emphasizes Zoryana Zachepilo, attorney at law.
Cryptocurrency loans are a new financing tool that is becoming increasingly popular among those who use digital assets.
At the same time, the expert explains, such loans often have non-transparent terms, and the amount of debt can increase significantly due to hidden fees, excessive penalties, and automatic interest accrual. The companies that provide such loans actually operate in a legal “gray area.” Zoryana Zachepilo draws attention to the main risks of such loans.
“First, the agreements that are drawn up when providing crypto loans are often not legally binding, so in the event of a conflict, it will be difficult to defend yourself in court. Secondly, there are hidden fees and penalties: the terms of such loans are often unclear, so the debt may unexpectedly increase due to additional charges. And thirdly, many such services are unlicensed and not controlled by the state, which means they operate outside the law. And, as the practice of Zakhyst Attorneys at Law shows, courts often invalidate cryptocurrency loan agreements precisely because there is no legal basis for entering into such obligations,” says attorney Zoryana Zachepilo.
To summarize, it can be stated that every case related to the protection of borrower’s rights has a better chance of success if legal assistance is sought in a timely manner. This allows not only to minimize financial risks for the borrower, but also to effectively protect his or her violated rights in pre-trial or court proceedings.
Author: Sergiy Vasilevich
