The small business lending market in Uzbekistan shows moderate concentration

The small business lending market in Uzbekistan exhibits moderate concentration.

The Central Bank of the Republic of Uzbekistan reports that the small and medium-sized business lending market in the country is characterized by moderate concentration, as evidenced by the Herfindahl-Hirschman Index (HHI), which has reached approximately 1,931 points in this segment.

According to the methodology of the pilot financial inclusion index, HHI values of up to 1,500 indicate low market concentration, 1,500 to 2,500 indicate moderate concentration, and above 2,500 indicate high concentration.

The value of 1,931 points, calculated based on data from the State Credit Information Registry of the Central Bank, falls in the middle of the moderate concentration range. This indicates the presence of several active market participants without the clear dominance of any single player.

The Central Bank emphasizes that market structure and the specifics of the financial products offered can influence the choices of small and medium-sized businesses, as well as the service terms they are offered.

This ongoing concentration makes it important to monitor the availability of alternative offers in the market. However, an attractive interest rate alone is not the only criterion for assessing a product's practical value for a particular business.

The competition indicator is presented in the report alongside an assessment of the quality of credit and savings products for small and medium-sized businesses, which overall scored 43 out of 100. The quality of savings products was rated at 50 points, while that of credit products was rated at 41 points.

The assessment of savings products was particularly influenced by the average interest rate on new term deposits for businesses, which was approximately 17.4 percent, and for rural SMEs, 16.6 percent.