Uzbekistan Central Bank explains new instalment rules

Tashkent, Uzbekistan (UzDaily.uz) — Uzbekistan's Central Bank has outlined a package of measures to improve instalment payment services for individuals, including limits on the amount and term of instalment agreements, requirements for operators and new consumer protection rules.

Uzbekistan's President Shavkat Mirziyoyev previously signed a resolution on measures to improve instalment payment services for the population, UzDaily.uz reported.

According to materials from the Central Bank, the reform has three objectives: protecting consumer rights, preventing excessive and hidden growth in household debt burdens, and promoting the wider use of financial technologies.

From 1 January 2027, Uzbekistan will introduce the activity of instalment payment service operators (muddatli to‘lov xizmati). A bank or microfinance organization may operate as an instalment service operator under a notification procedure with the Central Bank. Another legal entity may also operate after completing registration with the Central Bank and being included in the relevant register. The right to conduct the activity will arise only after inclusion in the register.

Real estate and property withdrawn from circulation or subject to restrictions on circulation cannot be the subject of an instalment service. The Central Bank has been designated as the authority responsible for regulation and supervision in this area.

Instalment agreements will be subject to a number of conditions. The maximum amount will be 250 times the base calculation value, or about 100 million soums, while the maximum term will be 12 months. If the term is longer, the agreement will be considered a consumer credit agreement.

Commissions, markups and other payments must be stated separately. All payments exceeding the principal debt, including intermediary fees, penalties, late-payment charges and other measures, must not exceed half of the instalment amount over one year.

Consumers will have the right to repay their debt early, either fully or partially, at any time without additional penalties, late-payment charges or commissions.

Instalment service operators will be required to comply with prudential standards and Central Bank requirements, conduct digital identification and verification of customers, establish the exchange of credit information with credit bureaus and comply with debt-burden requirements.

Operators may assign their claims only to a bank, microfinance organization or another instalment service operator. Operators will be prohibited from providing financial consumer loans or attracting funds from individuals, except through the issuance of bonds.

Separate requirements will apply to retail organizations providing consumer goods credit, excluding manufacturing enterprises. Organizations whose quarterly turnover exceeds 500 million soums and where instalment services account for 50% or more of that turnover will be required to complete registration, enter the relevant register and comply with the requirements established for instalment service operators under the resolution.

From 1 January 2027, organizations providing consumer goods credit will be required to submit information on agreements worth three or more base calculation values to credit bureaus. This requirement will not apply to agreements below that amount.

The Competition Committee, together with the Central Bank and the National Agency of Perspective Projects, will monitor advertising to ensure that consumers are not misled about the amount of a markup on goods. The base price of the goods, the instalment markup and the total cost of the credit must be disclosed and presented in the same font size.

The Central Bank has also been given additional powers, including establishing procedures for authorization and notification, maintaining a register of organizations, introducing requirements for maximum debt-burden levels and minimum charter capital, and setting consumer protection requirements.

These consumer protection requirements will cover transparency of contractual terms, the procedure for calculating commissions and other payments, and consumers' rights to repay debts early.

The regulator will also establish and monitor compliance with mandatory rules for payment services, information security requirements, prudential standards, and measures to combat the legalization of proceeds from crime, terrorist financing and the proliferation of weapons of mass destruction. Enforcement measures will be applied to organizations that violate the established requirements.

The resolution also establishes a schedule for implementation. Within three months, proposals are to be prepared for amendments and additions to legislation arising from the decision.

By 1 January 2027, a draft law regulating the activities of instalment payment service operators is to be developed and submitted to the Cabinet of Ministers.

By 1 December 2026, procedures are to be developed for determining which organizations providing consumer goods credit are subject to registration based on their quarterly turnover from the sale of goods, works and services.

Proposals are also to be submitted to the Cabinet of Ministers on liability for legal entities that are not included in the register but illegally operate as instalment service operators, as well as measures to be applied when information on consumer goods credit agreements worth three or more base calculation values and information on their fulfilment is not submitted to credit bureaus.