In Uzbekistan, Proparco supports Ipak Yuli Bank in its activities in favor of MSMEs and impact projects

With a limited banking penetration rate and a high level of unemployment, Uzbekistan, the most populated country in Central Asia, presents significant development challenges. The Uzbek banking sector is also dominated by the strong presence of state-owned banks.

Established in 1990, Ipak Yuli Bank is the oldest private bank in the country and focuses on financing micro, small and medium-sized enterprises (MSMEs), a fast-growing segment that is still underserved by Uzbekistan's banking sector: while MSMEs contribute to about 59% of GDP and 78% of formal and informal employment, only 26% of them use bank loans.

By supporting Ipak Yuli, a bank where more than 70% of clients are MSMEs, Proparco is providing the bank with additional resources to develop its activity and thus facilitate job creation: this intervention by Proparco in favor of the Uzbek banking sector should enable the financing of more than 660 SMEs and the support of nearly 14,750 indirect jobs within these same SMEs.

In addition, Ipak Yuli, which employs 48% women, has adopted a gender policy, and aims to ensure better access for women to its financial products and to strengthen their representation in management teams and senior management. As such, the project has qualified for the 2X Challenge initiative.

Finally, 10% of the amount of the credit line will be dedicated to green projects on a best-effort basis.

"We are delighted to be working with Ipak Yuli, a bank that is firmly positioned to finance MSMEs and make a positive impact in Uzbekistan. Its willingness to also develop its green finance activities, following the example of the partnership already initiated with the European Bank for Reconstruction and Development and its energy efficiency program, makes it a key partner in the region for Proparco," said Emmanuel Haye, Deputy Head of the Financial Institutions and Inclusion Division at Proparco.

“This is our first deal with Proparco and we look forward to establishing a long-term and mutually beneficial partnership. Similarly to Proparco, Ipak Yuli aims at supporting private sector and increase financial inclusion among MSME. This loan facility will be utilized for supporting micro, small and medium enterprises, as well as financing "green" projects in Uzbekistan,” said Saidabror Saydakhmedov, Chairman of the Management Board at Ipak Yuli.

The project will thus contribute to SDG 8 (Decent Work and Economic Growth).