Expanding Opportunities for Young Entrepreneurs in Uzbekistan
The European Bank for Reconstruction and Development (EBRD) is investing up to $50 million (€42.7 million) in Uzbekistan’s O’zsanoatqurilishbank, commonly known as SQB, to support young entrepreneurs through expanded lending opportunities. This initiative is part of the EBRD’s Youth in Business programme in Central Asia, which specifically targets micro, small, and medium-sized enterprises (MSMEs) led or owned by individuals under the age of 35.
This focus on younger business owners aligns with Uzbekistan’s demographic trends. As of early 2025, the country had 9.63 million people aged 14 to 30, making up 25.7% of the total population. The EBRD’s investment is designed to address the challenges that smaller businesses face in accessing credit and to encourage economic growth driven by youth-led initiatives.
Financial Support for the Economy
The SQB loan is part of two broader EBRD operations worth up to $100 million (€85.4 million) in Uzbekistan’s financial sector. A second operation of up to $50 million (€42.7 million) will be directed toward the Mortgage Refinancing Company of Uzbekistan, aiming to strengthen the residential mortgage market and promote more standardized lending practices.
In Uzbekistan, small businesses play a crucial role in the economy. According to the National Statistics Committee, they accounted for 51.5% of GDP during the first nine months of 2025, with 1.2 million small business entities operating as of October 1, 2025.
Addressing Liquidity Challenges
Despite the abundance of liquidity in the economy, many smaller firms still struggle to access credit. Francis Malige, Managing Director and Head of the Financial Institutions Business Group at the EBRD, highlights that while money is available, it often flows into sovereign lending rather than the real economy.
“This gap needs to be addressed,” he said. “The SQB credit line is designed to target young firms that often struggle to meet traditional banking standards.”
Barriers to Bankability
For many small businesses, the first hurdle is not the idea itself but whether they can meet the documentation requirements expected by banks. Malige explained that many SMEs face a structural mismatch with the banking system.
“They do not speak to banks in a way that banks expect them to,” he said. This includes having fewer financial forecasts, less formalized financial planning, and lower transparency compared to larger companies.
In SME lending, banks must place greater emphasis on the credibility of the founder, the management team, and the business plan.
Gender Considerations in Access to Credit
Women entrepreneurs face additional challenges when seeking financing. Ceren Güven Güres, Head of the UN Women Central Asia Liaison Office, noted that while Uzbekistan has made progress in gender equality reforms, legal and policy changes do not automatically translate into equal access to financial services.
“Are they aware of their rights? Are they aware of these services?” she asked. Access to information, networks, and support services is essential for women to effectively use available programs.
Collateral and Lending Practices
Another major challenge is the reliance on collateral in lending decisions. Many young entrepreneurs and first-time business owners may not have the property or equipment needed to secure a loan.
“A lot of banks require collateral assets, fixed assets, and very often SMEs do not have these in a way that can actually support borrowing from banks,” Malige said.
He also pointed out that many banks treat SME lending as a downgraded version of corporate lending, which is not an effective approach.
The EBRD works with both borrowers and lenders to improve this situation. Through technical assistance, training, and risk-sharing instruments like first-loss cover, the EBRD helps banks lend to clients who lack traditional collateral.
Beyond Credit: Supporting Women Entrepreneurs
For women entrepreneurs, access to finance is influenced by factors beyond the banking system. Social expectations, gender stereotypes, and care responsibilities can limit their ability to build businesses and engage with available resources.
“We need to go back to the root causes, the harmful social norms and gender stereotypes, the care burden on women,” Güres said. Support programs must continue after women launch or formalize their businesses, offering mentoring, tailored assistance, grants, and loans to help them grow.
Conclusion
The EBRD’s investment in Uzbekistan reflects a commitment to fostering inclusive economic growth by addressing the unique challenges faced by young and women entrepreneurs. By improving access to credit and supporting sustainable business practices, these efforts aim to create a more resilient and dynamic economy.
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