The microfinance sector in Uzbekistan has experienced a substantial surge in activity, with the loan portfolios of microfinance organizations nearly doubling from 104 to 210 since 2018, Spot reports.
This revelation emerged from a presentation by the regulator during a seminar on financing micro-businesses, and small, and medium-sized enterprises held on March 19. The data underscores the sector's burgeoning role in facilitating access to financial services across the republic.
Expanding Landscape of Financial Institutions
As of March 1, 2024, Uzbekistan boasts a diverse landscape of financial institutions, with 88 pawnshops, 86 microfinance organizations, and 36 banks operating within its borders. The proliferation of such institutions has been remarkable, with their numbers more than doubling since 2018, climbing from 104 to 210. Notably, the microfinance sector has exhibited the most robust growth, while the banking sector saw a comparatively modest growth rate of 28.5%.
Staggering Increase in Loan Portfolios and Market Share
The statistics reveal a significant escalation in the loan portfolios of non-bank credit organizations, soaring from UZS 4.24 trillion ($336.1mn) to UZS 8.05 trillion ($638.1mn) over the past 11 months. Concurrently, their share in the overall banking and financial system has climbed from 1% to 1.7%, underlining their increasing significance in the financial landscape.
The size of assets and loan balance of microfinance companies has surged nearly 2.5 times, reaching UZS 4.91 trillion ($389.2mn) and UZS 4.48 trillion ($355.1mn), respectively. This places microcredit organizations ahead of the Mortgage Refinancing Company and pawnshops in terms of these key indicators, demonstrating their substantial presence and influence in the market.
Tripled Liabilities and Doubled Capital Reflect Sector Growth
In a clear reflection of the sector's expansion, the liabilities of microfinance organizations have tripled over the past year, soaring to UZS 3.09 trillion ($244.9mn). Similarly, mortgage refinancing companies have nearly doubled their liabilities, reaching UZS 3.41 trillion ($270.3mn).
Moreover, the volume of capital held by microcredit companies has more than doubled, surpassing UZS 1.8 trillion ($142.7mn), highlighting the sector's enhanced financial stability and capacity.
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