uzbekistan

Author:
ConsumerCentriX Project Team
Date:
September 26th, 2023
Area Covered:
Uzbekistan • Central Asia
Topics:
Financial Inclusion • Women’s Financial Inclusion • Micro, Small and Medium Enterprises (MSMEs) • Financial Regulation  • Research

Uzbekistan has recently witnessed significant economic growth and development, creating new opportunities for financial services providers. One emerging and untapped area is the women’s market for financial services.

To delve into this potential business opportunity, the International Finance Cooperation hired ConsumerCentriX to conduct a comprehensive market research study to assess the viability and dynamics of catering financial and non-financial products and services specifically to women in Uzbekistan. The study aims to provide a 360° understanding of the women’s market for financial and additional non-financial services examining demand-side needs and preferences, supply-side readiness, and the conducive state of the underlying enabling environment.

The research was conducted over six months and involved a mix of qualitative and quantitative methodologies using principles of Human-Centered Design (HCD). Through surveys, focus group discussions and in-depth interviews, the CCX team assessed the demand side of the women’s market and offered distinct insights on women both as individuals and as entrepreneurs. The sample size was strategically chosen to ensure representation from urban and rural areas (retail segment) and women SMEs at different stages of business growth (business segment), all the while covering women from different socio-economic backgrounds, age groups and occupations.

Several Key Insights:

• The majority of women entrepreneurs pointed out access to finance as a significant obstacle to their current operations, and while most claim banks to be their first choice when it comes to borrowing, the actual integration of women entrepreneurs into the formal sector remains low.
• For investments planned in the near future, most women’s businesses intend to finance their activities from sources perceived as more suitable and approachable than FIs.
• Current formal lending options are often regarded as too expensive to finance and too risky to lose collateral – that they often do not even have.
• Often facing time and mobility constraints, women as individuals unanimously expressed a strong need for more convenient and speedy service, including digital (mobile) options. These women also expressed a robust interest in working with FIs to plan a more secure financial future – and for the financial stability of their families, their children’s education is considered the key investment.
• With a strong preference for keeping their savings in cash, most women seem to have not yet been convinced of the benefits of savings with financial institutions. Similarly, only a small minority have borrowed from formal sources while informal means play a significant role.
• Current market offers mostly provide banking as a commodity, leaving an opportunity to provide more value for women as individuals and as entrepreneurs. The few dedicated products for women still reflect a program-driven focus on loans rather than a broader value proposition.
• Aside from these specialized loan products, there are no other types of specialized products for women that involve deposits and savings, insurance, or payments and money transfer arrangements, or women-specific bundles of such services.
• The non-financial services also have a narrow functional focus. At the same time, Uzbekistan is rapidly becoming a focus for digital financial services providers.

The Uzbek enabling environment presents a mixed picture of strong socio-cultural limitations as well as the substantially supportive digital driver, which is strengthening female financial inclusion. While the country’s legal and regulatory framework and the existing support systems are currently more neutral drivers, both areas offer the potential to significantly move the needle for women navigating their way through the Uzbek financial sector.