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INVESTINGRetail lending traits in CIS nations.

Retail lending traits in CIS nations.

Evaluation and Outlook


In recent years, retail lending in CIS countries has skilled huge growth, particularly in patron loans and vehicle loans. This surge is attributed to various financial elements and regulatory measures aimed toward stimulating economic hobby and expanding get right of entry to to credit score offerings. this article offers a complete evaluate of retail lending tendencies in CIS international locations, that specialize in Uzbekistan and Kazakhstan, and discusses the associated risks and regulatory responses.

Key Findings

rapid increase in Retail Lending: Retail lending in Uzbekistan and Kazakhstan witnessed notable growth, with will increase of 171% and 134%, respectively, from 2021 to 2023.

Drivers of growth:

excessive call for for purchaser loans and automobile loans fueled the surge in retail lending.

Favorable monetary conditions, growing family incomes, and digitalization facilitated less difficult get entry to to credit offerings.

improved transactions in residential actual property, driven by way of mortgage boom, contributed to demand for customer loans.

hazard elements:

fast growth in client lending poses credit score dangers for banks, as debtors’ debt burdens can also outpace their nominal earning.

high inflation reduces debtors’ actual income, impacting their ability to repay loans.

Availability of short-term financing and high hobby quotes encourage banks to increase lending to consumers.

unique tendencies in Uzbekistan and Kazakhstan

patron Loans and automobile Loans in Uzbekistan:

consumer loans surged by means of 410%, whilst vehicle loans improved via 264% from 2021 to 2023.

Unsecured client loans are growing swiftly, probably main to an boom in late debt.

car loans, despite the fact that secured, face delinquency risks due to charge increases and excessive monthly bills relative to disposable income.

Mortgages and actual property traits:

Mortgages in Uzbekistan and Kazakhstan have shown big growth, pushed by using authorities programs and extended demand for residential real estate.

however, growing housing costs and decreased affordability improve dangers for banks, particularly if there may be a market correction.

Regulatory Measures and danger Mitigation

Regulatory Responses:

Uzbekistan and Kazakhstan regulators are implementing measures to limit borrowers’ debt burdens, which include maximum fee-to-profits (PTI) ratios and threat weight modifications.

Uzbekistan delivered a 25% cap on automobile loans’ proportion in general loans and plans to tighten PTI ratio limits for all loans.

impact on Lending boom:

those regulatory measures are expected to sluggish down the growth of car loans and mitigate dangers associated with high debt burdens.

In Kazakhstan, regulations had been in vicinity on account that 2014, which includes a most PTI ratio of fifty% and extended hazard weights for excessive-debt borrowers and loans with excessive interest charges.


The speedy growth in retail lending in CIS nations presents possibilities for economic enlargement but additionally poses risks, particularly in phrases of credit score excellent and asset first-class for banks. Regulatory interventions aimed toward controlling debt tiers and threat control might be crucial in preserving balance and sustainable growth within the retail lending quarter.

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