The Central Bank is tightening some terms for microloans, with its order, registered with the Ministry of Justice on April 22 and which will take effect on July 24.

In particular, a loan concentration coefficient by industry is being introduced for banks. The share of microloans issued to individuals should not exceed 25% of the bank's total loan portfolio (for some banks, this figure reaches 100%).

The Bank previously noted that for banks whose current concentration of microloans exceeds this level, an action plan will be developed to ensure compliance with the necessary time. They are given until January 1, 2029, to reduce the share of microloans in their portfolio to the required level.

The document stipulates that when issuing a microloan to a borrower (or joint borrowers), the debt burden indicator should not exceed 50%. That is, banks will refuse loans if the borrower spends more than 50% of their income on repayment.

The regulator has set a maximum timeline for microloans of 36 months for monthly payments on the borrower's obligations (for mortgage loans - 180 months, for others - 60 months).

Norms for limiting growth of debt burden

The total amount of interest and other payments (except for payments on the principal debt and fines for failure to comply with the terms of the agreement) on a loan or microloan issued by a bank to individuals must not exceed 0.3% (previously 0.25%) of the remaining principal debt per day.

Maximum overpayment amount

In addition, the total value of all payments, including interest, commission fees, fines and other liability measures (except for the principal debt), must not exceed 50% of the loan amount per year (initially 45% was proposed).

The changes provide for that the total amount of all payments in excess of the principal — including interest, brokerage fees, penalties (fines, fines) and other payments — cannot exceed 50% of the loan amount per year.

If a person took, for example, 1 million soums in credit, then all of overpayment (interest + fees + possible fines) for the year should not exceed 500 thousand soums.

The interest itself can be high, but together with other additional expenses, the total amount of overpayment for the year is limited to 50%.

The measure is aimed at limiting the total cost of the loan for the borrower, and not at directly reducing the interest rate, the Central Bank explained.

Norms for loan concentration

The share of microloans (including overdraft and credit cards) issued to individuals should not exceed 25% of the bank's total loan portfolio.