Amendments and Additions to the Regulation on Regulating the Debt Burden of Individual Borrowers

Resolution of the Board of the Central Bank of the Republic of Uzbekistan, registered on February 21, 2024, registration number 3205-3

Date of entry into force

March 23, 2024

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03.00.00.00 Civil legislation / 03.11.00.00 Specific types of obligations / 03.11.17.00 Calculations (see also 07.21.03.00) / 03.11.17.01 General rules. Receivables and payables;
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Finance / Banks and other credit institutions. Credits]

RESOLUTION OF THE BOARD OF THE CENTRAL BANK OF THE REPUBLIC OF UZBEKISTON

On Amendments and Additions to the Regulation on Regulating the Debt Burden of Individual Borrowers

[Registered by the Ministry of Justice of the Republic of Uzbekistan on February 21, 2024, registration number 3205-3]

In accordance with the Law of the Republic of Uzbekistan "On the Central Bank of the Republic of Uzbekistan", the Board of the Central Bank of the Republic of Uzbekistan resolves:

1. Amendments and additions shall be made to the Regulation on Regulating the Debt Burden of Individual Borrowers, approved by Resolution No. 24/5 of the Board of the Central Bank of the Republic of Uzbekistan dated September 28, 2019 (registration number 3205, December 19, 2019) (National Database of Legislative Acts of the Republic of Uzbekistan, December 19, 2019, No. 10/19/3205/4177-4), in accordance with the Appendix.

2. This resolution has been agreed upon with the Chamber of Commerce and Industry of the Republic of Uzbekistan.

3. This resolution shall enter into force one month after its official publication.

Chairman of the Central Bank M. NURMURATOV

Tashkent city,

January 26, 2024,

No. 42/16

Agreed:

Chairman of the Chamber of Commerce and Industry of Uzbekistan D. VAKHABOV

January 20, 2024

APPENDIX

to Resolution No. 42/16 of the Board of the Central Bank of the Republic of Uzbekistan dated January 26, 2024

Amendments and Additions to the Regulation on Regulating the Debt Burden of Individual Borrowers

1.
The Preamble shall be worded as follows:

"This Regulation establishes the procedure for calculating the debt burden, the permissible amount of the debt burden, as well as the maximum daily interest rates for loans and microloans when credits (microloans) are granted to individual borrowers."

2. In the second subparagraph of paragraph 1, the second and third subparagraphs of paragraph 4, paragraph 6, and the second subparagraph of paragraph 7, the word "microloan" shall be replaced with the words "credit (microloan)".

3. Paragraph 1-1 of the following content shall be added:

"1-1. The requirements of this Regulation shall not apply to credits granted within the framework of programs for the development of family entrepreneurship."

4. Paragraph 2 shall be worded as follows:

"2. Until July 1, 2024, the debt burden indicator for each borrower shall be calculated when a microloan is granted by the lender as the sum of its amount and the total principal balance of the borrower's active credit (microloan) agreements, if it exceeds 50 times the base calculation amount.

Starting from July 1, 2024, the debt burden indicator for each borrower shall be calculated when a credit (microloan) is granted by the lender, including when a decision is made to increase the amount of average monthly payments for this credit (microloan), increase the lending limit, and extend the term (hereinafter in the text, granting a credit (microloan) shall be referred to).

In this case, the debt burden indicator:

shall not be calculated or taken into account when a bank grants a credit (microloan) to an individual if the amount is no more than 15 percent of the largest number of all credits granted by this bank to individuals and the number of microloans;

shall not be calculated or taken into account when a microfinance organization and a pawnshop grant a credit (microloan) to a borrower who is an individual if the sum of its amount and the total principal balance of the borrower's active credit (microloan) agreements does not exceed 50 times the base calculation amount;

shall not be calculated or taken into account when a microfinance organization grants a microcredit to a borrower who is a self-employed person if the sum of its amount and the total principal balance of the borrower's active credit (microloan) agreements does not exceed 75 times the base calculation amount."

5. Paragraph 4-1 of the following content shall be added:

"4-1. If the term for repayment of a credit (microloan) under a credit (microloan) agreement exceeds 36 months, all payments for the credit (microloan) shall be distributed in an equal amount (annuity method) over 36 months in the calculation of the amount of average monthly payments for the debt burden, except for mortgage loans and education credits granted from resources placed by the Ministry of Economy and Finance of the Republic of Uzbekistan.

If the term for repayment of a mortgage loan under a mortgage loan agreement exceeds 180 months, all payments for the credit shall be distributed in an equal amount (annuity method) over 180 months in the calculation of the amount of average monthly payments for the debt burden, except for mortgage loans granted within the framework of state programs, including from the funds of the Ministry of Economy and Finance of the Republic of Uzbekistan and organizations refinancing mortgages."

6. The eighth subparagraph of paragraph 9 shall be worded as follows:

"In this case, when determining the average monthly income of the borrower and the borrower together:

the bank must obtain information about incomes specified in the second through seventh subparagraphs of this paragraph for at least the last six months;

a microfinance organization and a pawnshop may use information other than documents specified in the second through seventh subparagraphs of this paragraph."

7. Paragraph 10 shall be worded as follows:

"10. Until July 1, 2024, the debt burden indicator of an individual when granting microloans by the lender must not exceed 50 percent.

When granting a credit (microloan) by the lender, the debt burden indicator of an individual:

from July 1, 2024, to January 1, 2025 — must not exceed 60 percent;

starting from January 1, 2025 — must not exceed 50 percent."

(, February 22, 2024, No. 10/24/3205-3/0143-3)