Tashkent, Uzbekistan (UzDaily.com) -- The Central Bank of Uzbekistan plans to allow the functioning of microfinance banks, said Deputy Chairman of the Central Bank Abrorkhuzha Turdaliev.

This new type of credit institutions will act as an intermediate link between banks and microfinance companies.

The Central Bank is currently developing a bill on the creation of microfinance banks, which is expected to be submitted to the Cabinet of Ministers by April.

Microfinance banks will support microbusinesses and perform an important function in the development of this sector of the economy.

Turdaliev also noted the need to create regional banks for microfinance, increasing the availability of credit. Microfinance organizations will be able to transform into microfinance banks by obtaining a license from the regulator, and ordinary banks will also have the opportunity to change their profile to a microfinance bank in case of failure to meet authorized capital requirements.

Requirements for microfinance banks will include the condition that at least 70% of their total loan portfolio must be allocated to business financing. Such measures are aimed at encouraging banks to support micro-businesses and improve conditions for this sector.

The minimum authorized capital for microfinance banks will be set at 50 billion soums, and the maximum - 500 billion soums. The Central Bank is calling for the creation of district banks, as they can better adapt to the needs of local people and increase the availability of finance in districts.

In April last year, the President of Uzbekistan approved a phased increase in the minimum authorized capital for banks. From 1 September 2023, this amount amounted to 200 billion soums, April 1 from 2024, it should increase to 350 billion soums, and from 1 January 2025 - to 500 billion soums.