Microfinance Organizations and Pawnshops Issued Loans Totaling 13.3 Trillion Soums in H1 2025

Tashkent, Uzbekistan (UzDaily.com) — The Central Bank of Uzbekistan has published its report, Microfinance Organizations and Pawnshops: Financial Overview for H1 2025.

According to the review, the microfinance market saw the entry of new participants in the first half of 2025: 20 new microfinance organizations and 139 branches were established (99 microfinance organizations and 40 pawnshops), bringing the total to 210 entities, including 120 microfinance organizations with 335 branches and 90 pawnshops with 111 branches.

The number of microfinance organizations with foreign capital increased by 5 compared to the same period last year, totaling 20 (12 microfinance organizations and 8 pawnshops). The highest concentration of microfinance organizations and pawnshops was in Tashkent (64 microfinance organizations and 47 pawnshops) and Ferghana Region (19 microfinance organizations and 4 pawnshops). In the Republic of Karakalpakstan and Kashkadarya Region, only one head office is registered in each. Tashkent hosts 36 pawnshop branches and 31 microfinance branches, while in Syrdarya Region there are 3 and 10, respectively.

In January–June 2025, microfinance organizations and pawnshops issued loans totaling 13.3 trillion soums, 2.1 times higher than the same period last year. Lending by microfinance organizations grew 2.2 times, while pawnshop lending increased by 31%. Microfinance organizations accounted for 90% of all loans (12 trillion soums), pawnshops for 10% (1.3 trillion soums).

Of this amount, 12.8 trillion soums (97%) went to individuals and 417 billion soums (3%) to legal entities. Online loans accounted for 66% of the total loans issued by microfinance organizations, up 26% from the previous year. The rapid growth in online lending is attributed to active use of services such as Uzum Market, Uzum Tezkor, and Uzum Nasiya, as well as the activities of microfinance organizations Tezkoin (5.6 trillion soums), Shaffof-Moliya (2.3 trillion soums), and Peyleyter (56 billion soums).

Microfinance organizations are permitted to offer Islamic finance products, including murabaha, Islamic leasing (ijara), salam, musharaka, and mudaraba. In H1 2025, the volume of such services totaled 3.9 billion soums, all under murabaha. This permission was granted following the approval of the Regulation On the Procedure for Providing Islamic Financial Services by Microfinance Organizations (registration number 3536, 26 July 2024).

In the individual lending segment, loans under 10 million soums accounted for 60% of all loans, 10–20 million and 20–50 million soums each made up 15%, and 50–100 million soums loans comprised 10%. Compared to last year, loans under 10 million soums increased by 14%, 10–20 million by 1%, while 20–50 million and 50–100 million soums loans decreased by 9% and 6%, respectively.

In the corporate segment, loans of 100–200 million soums accounted for 51%, 200–300 million for 30%, over 300 million for 7%, and 0–50 million and 50–100 million for 6% each. Compared to the previous year, loans up to 50 million increased by 1%, loans over 300 million by 2%, and 200–300 million by 3%, while 50–100 million and 100–200 million loans decreased by 5% and 1%, respectively.

The weighted average interest rate on microloans issued by microfinance organizations in June 2025 was 60.2% (range: 42%–109.5%). For microcredits, the rate was 55.3% (44.9%–72%). Of all microloans, 0.2% were issued at the minimum rate (42%) and 1.9% at the maximum (109.5%). For microcredits, 6.5% were at the lower bound (44.9%) and 2.3% at the upper bound (72%). Individual rates ranged from 36% to 109.5%, for entrepreneurs and legal entities from 41% to 60%, with weighted averages of 59.9% and 50.9%, respectively. Pawnshop rates in June ranged from 60% to 109.5%, with a weighted average of 97.8%.

Total assets of microfinance organizations and pawnshops as of 1 July 2025 increased 1.6 times year-on-year, reaching 10 trillion soums. Microfinance organization assets grew 1.6 times (by 3.9 trillion soums) to 9.4 trillion, while pawnshop assets increased 1.5 times (by 193 billion soums) to 606 billion. Credit investments accounted for 95% of total assets (9.5 trillion soums), growing 1.6 times overall, including 1.7 times in microfinance organizations and 1.5 times in pawnshops. Microfinance organizations and pawnshops’ share of total banking sector loans reached 1.6%.

Household debt to microfinance organizations and pawnshops rose 1.5 times to 8.4 trillion soums, while corporate debt grew 3.8 times to 1.1 trillion soums. Microcredit debt for entrepreneurs and legal entities increased nearly fourfold to 1 trillion soums, factoring services grew 4.1 times to 124 billion soums, while leasing services fell 40% to 7.2 billion soums.

Non-performing loans (NPLs) as of 1 July 2025 totaled 436 billion soums (4.8%), up 246 billion soums or 2.4 percentage points from the start of the year. “Doubtful” loans grew 2.6 times (by 253 billion soums), while “loss” loans decreased 28% (by 7 billion soums). Of the total NPLs, 96% were doubtful (413 billion soums) and 4% loss (18 billion soums). Tezkoin and Shaffof-Moliya accounted for about 90% of the increase in problem loans. The loan coverage ratio fell 5 percentage points to 52%.

Total liabilities of microfinance organizations and pawnshops as of 1 July 2025 grew 1.7 times to 6.7 trillion soums, with microfinance organizations accounting for 6.6 trillion (1.7 times growth) and pawnshops 125 billion (1.5 times growth). Microfinance organization liabilities consisted of 15% founders’ funds, 34% commercial bank resources, 6% international financial institutions, 26% local companies, 4% bond placements, and 15% other obligations. Pawnshops’ liabilities included 56% founders’ funds, 17% commercial bank resources, and 28% other obligations.

Total equity of microfinance organizations and pawnshops increased 1.4 times to 3.2 trillion soums: 2.8 trillion in microfinance organizations and 481 billion in pawnshops. Capital growth was supported by increases in charter capital, retained earnings, and reserves. In microfinance organizations, charter capital grew by 525 billion soums (54%), retained earnings by 145 billion (28%), current profit by 42 billion (10%), and reserves by 45 billion (60%). Pawnshop charter capital increased by 58 billion (60%), retained earnings by 68 billion (49%), and current profit by 26 billion soums (32%).

In H1 2025, total income of microfinance organizations and pawnshops reached 2.4 trillion soums, expenses 1.9 trillion, and net profit 569 billion. Microfinance organizations earned 2.2 trillion, spent 1.7 trillion, and gained 462 billion in profit. Pawnshops’ income was 230 billion, expenses 123 billion, net profit 107 billion soums.

Return on assets (ROA) for microfinance organizations fell 0.2 percentage points to 19.7%, while return on equity (ROE) dropped 5.1 points to 39.8%, reflecting slower net profit growth relative to assets and capital. In pawnshops, ROA decreased 1.4 points to 55.3%, while ROE increased 0.5 points to 51.7%.