The Central Bank is planning to tighten requirements for banks regarding the issuance of microloans. This was announced on February 25 during a media dialogue by the director of the Department of Methodology for Regulating Credit Organizations, Sanjar Nosirov, as reported by Spot's correspondent.

According to the regulator's data, in the first half of 2024, the number of citizens who took out microloans exceeded 2 million, while at the end of last year, the figure was close to 2.5 million. On average, there are 1.6 microloans per borrower.

Additionally, the concentration of assets in banks' loan portfolios is increasing, particularly in the segments of auto loans and microloans. The Central Bank considers the high growth rates of auto loans and microloans issued to the population, disruptions in borrowers' incomes, and declining market values of vehicles as negative consequences for the stability of banks.

“Given this, the adoption of macroprudential measures is crucial to prevent 'overheating' in the retail lending segment and ensure the stability of the banking system,” stated Sanjar Nosirov.

In particular, the Central Bank intends to limit the share of microloans to 25% in the commercial banks' loan portfolios, similar to auto loans. In this regard, the regulator refers to the experiences of countries such as China and India.

According to Nosirov, currently, five banks have microloans exceeding 25%, three of which are 'new' banks, so the regulator expects their share to decline as the loan portfolio grows. The Central Bank has negotiated with two banks and given them time to amend their lending products.

Author of the Telegram channel Nikita Makarenko named two banks—TBC Bank and Anor Bank—where "100% of all loans in the portfolio" consist of microloans. However, during the meeting with the media, Central Bank representatives did not disclose the list of banks, so Spot cannot verify the accuracy of this information.

Nusratulla Fazilov, head of the Department of Prudential Supervision of Banks, noted that the regulator does not predict that the issuance of microloans will decrease as significantly as auto loans after the introduction of restrictions. This is supported by the fact that in many banks, the share of microloans is less than 25% in the loan portfolio, the official emphasized.

Microfinancing

In January 2024, the then-head of the Central Bank, Mamarizo Nurmuratov, stated that there were no prerequisites for forming a bubble in the microfinancing market. In 2023, the share of retail loans in the overall portfolio increased from 26% to 33%, and overheating was observed in certain segments of retail lending.

At the end of February of the same year, Shavkat Mirziyoyev approved the doubling of the maximum microloan amount—from 50 to 100 million sums.

By the end of last year, the president instructed the establishment of 50 microfinance organizations and allocated financial resources amounting to 1 trillion sums for them.

In July, the Central Bank approved regulations for the operation of microfinance organizations in the field of Islamic finance. Microfinance organizations will be able to engage in Islamic financing, but they will need to establish a special council and maintain separate reporting.

Additionally, starting from November 1, a "cooling-off period" was introduced for online loans. When applying through the app, biometric identification must be completed. This allows determining whether the application was submitted personally by the applicant. If the borrower has numerous debts or delinquencies, the bank may refuse the loan or reduce its amount.

By the end of 2024, the volumes of microloans (45.83 trillion sums) and microcredits (17.4 trillion sums) increased by more than half. In the second half of the year, the growth rates of microloans accelerated, and in December, an absolute record was set—5.1 trillion sums.

Earlier, Spot reported that in 2024, MFIs doubled their loan issuance, half of which went to Uzum.