Tashkent, Uzbekistan (UzDaily.uz) — Uzbekistan is introducing a new regulatory framework for installment services (buy now pay later) aimed at protecting consumers, improving contract transparency and preventing excessive growth in household debt burdens, Central Bank department director Farukh Sheripbayev said in the Saylgoh podcast.
The Central Bank has been tracking and analyzing the installment market since 1 January 2025, as purchases of goods and services on installment plans have grown significantly in popularity. Over the period, the portfolio of organizations providing installment services increased 2.5-fold.
The market currently includes commercial banks, microfinance organizations and companies providing goods-based consumer loans, or installment services. Banks and microfinance organizations account for about 40% of the market, while organizations providing goods-based consumer loans hold the remaining 60%.
The activities of the latter category had previously not been fully regulated or supervised. According to Sheripbayev, the absence of a single regulator and legislative requirements had resulted in insufficient consumer protection, a lack of transparency in contract terms and the risk of excessive debt accumulation.
The changes were introduced under Presidential Resolution No. 294 dated 14 August, which provides for improvements to the procedure for providing installment services to the population.
The main objectives of the new rules are to protect consumer rights, prevent excessive and hidden increases in debt burdens, and promote wider use of financial technologies in installment services.
One of the key changes will be greater contract transparency. Contracts must separately specify the operator’s markup, commissions and other payments included in the final cost of a product, work or service.
Consumers must be able to understand in advance the total amount of their obligations, the markup, the conditions for applying fines and penalties, and the total amount payable. Central Bank research has shown that customers are not always provided with this information. In many cases, they receive only a payment schedule without a detailed breakdown of additional costs.
The new framework will also cap the total amount of payments under an installment service above the principal debt. This includes intermediary fees, contractual penalties, fines and late-payment charges. Their combined amount may not exceed half the amount of the installment service.
Consumers will also have the right to repay their installment debt fully or partially at any time without fines or penalties.
A separate set of requirements concerns debt burdens. When deciding whether to provide an installment plan, an organization must take into account the client’s established maximum debt-burden level. If a new installment plan would cause the permissible threshold to be exceeded, it may not be granted.
Information on all installment contracts concluded by operators, as well as data on their performance, will be submitted to credit bureaus. This will allow existing obligations to be taken into account when a person subsequently applies for loans or other financial services.
From 1 January, the activities of installment service operators will also be formally introduced. They will become market participants subject to regulation and supervision.
The Central Bank will establish a register of organizations authorized to provide installment services. Banks and microfinance organizations will be included through a notification procedure. Other legal entities — installment service operators and organizations providing goods-based consumer loans that meet the established criteria — will have to register with the Central Bank.
The Central Bank has been designated as the authorized state body responsible for regulating and supervising installment service operators. Relevant amendments and additions to legislation must be introduced within three months, after which separate registration and notification procedures will be developed.
The new framework also establishes a maximum term for an installment service itself. Such a contract may be concluded for up to 12 months.
This restriction does not prohibit the purchase of goods with payment spread over two or three years. If a contract specifically for an installment service is concluded for more than 12 months, it will be treated as a consumer credit agreement.
Consumer loans are divided into financial and goods-based loans. Financial consumer credit, provided by banks and microfinance organizations, may be used to purchase durable goods.
The restriction also applies to the value of the installment service’s underlying object. Its maximum value is set at 250 basic calculation units.
The Central Bank analyzed organizations that conduct full-fledged credit information exchanges with credit bureaus. In 2025, 99% of services provided by organizations issuing goods-based consumer loans involved amounts of up to 100 million soums. About 90% of those services were provided for terms of up to one year.
Sheripbayev also cited international experience. In the United Kingdom, installment services are provided for terms of up to 12 months. Similar term restrictions apply in Qatar, Saudi Arabia, Oman and the United Arab Emirates.
The podcast also addressed the purchase of real estate on installment, an issue that attracted considerable public attention after information about the new rules was published.
Under the resolution, real estate may not be the subject of an installment service provided by an operator. This means that an installment service operator will not be able to finance an individual’s purchase of housing.
However, the new framework does not prohibit direct installment sales of real estate by developers.
If a construction company has built a property itself and directly concludes an agreement with a buyer for its purchase with payment in installments, the transaction is not considered an installment service under the new regulations.
The difference lies in the financing mechanism. When an installment service operator is involved, it pays the seller the cost of the goods on behalf of an individual, after which the buyer repays the operator the funds provided, including a markup or commission. This type of service is not permitted for real estate.
The Central Bank will establish prudential requirements and standards for installment service operators. They will also be required to identify and verify customers, comply with debt-burden requirements, and ensure that information on contracts and their performance is submitted to credit bureaus.
Separate requirements apply to organizations providing goods-based consumer loans. If, at the end of a quarter, their turnover from the sale of goods, works and services exceeds 500 million soums, and installment sales account for 50% or more of that turnover, the organization must register with the Central Bank and be included in the relevant register.
Such organizations will be subject to requirements concerning customer identification and verification, debt burdens, credit information exchange and compliance with established prudential requirements. Manufacturing enterprises that meet the relevant conditions will be exempt from these requirements.
The new framework also limits fines and other additional payments. The combined amount of all payments above the principal debt, including intermediary fees, contractual penalties, fines and late-payment charges, may not exceed half the amount of the installment service.
Consumers retain the right to repay their debt fully or partially at any time without fines or penalties.
In conclusion, Sheripbayev advised citizens to study installment contracts carefully before signing them. In particular, they should pay attention to markups and commissions, additional conditions and the amount of monthly payments.
According to the Central Bank representative, the main task of the new regulation is to ensure that consumers understand the full cost of a product or service, the extent of their obligations and the consequences of late payment before concluding a contract.
