The demand for mortgage finance is high in Uzbekistan, given the country’s rapid population growth from 20.6 million in 1991 to 35.3 million in 2022. Population growth is expected to continue at about 2% per year and will reach 40 million by 2030.

However, many people face challenges in accessing adequate and affordable housing due to limited supply, high costs, and lack of long-term financing options. These challenges are even more pronounced for women, who typically have lower incomes than men and fewer opportunities to save for housing. Additionally, cultural constraints often result in property being registered in the names of male family members. Women also face limited access to financial services, partly due to a lack of financial literacy and trust in financial institutions.  

To address these issues, the Asian Development Bank (ADB) has been supporting the Government of Uzbekistan in implementing the Mortgage Market Sector Development Program since 2019.

The program aims to transform the government’s housing financing approach to a market-based mortgage system that can provide long-term and affordable housing loans to low- and middle-income households, with specific consideration to home ownership by women. It established a mortgage refinancing company supported with long-term funding, and able to make long-term local currency resources available to banks to fund residential mortgage and housing improvement loans.

The program enabled Umida, a mother of two children from Andijan region, to successfully negotiate the housing challenges faced by many women in Uzbekistan.

She had to move out of her house after getting a divorce. In March 2020 she heard about the mortgage program and decided to access a loan. Initially, her parents did not support her decision, saying she would not be able to pay her debts and make the monthly repayments with the income from her job as a dental assistant.

But her brother helped her and became a guarantor while Umida was the primary borrower. She picked up jobs in two more dental clinics, and in a few months was able to fully repay her debts. Now she’s making her monthly mortgage payments on time.

“Thanks to the program, I have my own apartment to live in with my kids. No need to suffer from pressure anymore, nobody has the right to kick me out,” said Umida. “Sense of ownership gives me wings to fly, and a feeling of independence, pride, and happiness”.  

Umida is not alone in feeling empowered. Through promoting gender specific measures, ADB’s Mortgage Market Sector Development Program has brought positive changes for thousands of other borrowers.

“A safe and comfortable home is a basic human right, and we are pleased to have helped increase the availability of affordable mortgages in Uzbekistan, especially for women,” said ADB Country Director for Uzbekistan Kanokpan Lao-Araya. “As female borrowers report during our field visits, owning real estate has significantly transformed their lives. Women borrowers experienced higher self-esteem and self-confidence, and a feeling of empowerment.”

Under the program, developed jointly with the Ministry of Economy and Finance, long-term funding of $150 million is provided for the Mortgage Refinancing Company of Uzbekistan.

The company was set up with the support of ADB to make local currency resources available to eligible financial institutions that offer residential mortgages, home improvement loans, and refinance green renovation loans.

ADB’s support also promotes financing mechanisms to catalyze market-based mortgage finance in Uzbekistan, expand the availability of residential mortgage products including green financing, and bring product innovation to the banking sector.

One of the program’s key elements is to expand availability and knowledge of housing loans for women.

“We regularly conduct training and events on gender equality and increasing access to housing finance for women borrowers, thereby raising staff members’ awareness in the company and partner financial institutions,” said Mortgage Refinancing Company of Uzbekistan Chief Executive Officer Murodjon Farmanov.

“Our overall approach is guided by our gender policy and aims to achieve gender equality within the company and in our operations.”

According to loan officers of banks participating in the program, women borrowers service their mortgage debts on time and there are practically no overdue loans. It is often the case that women borrowers pay-off their mortgages in full, well before loan maturity.

In 2022, ADB extended its support for the program with an additional $150 million. According to the extended program indicators, at least 32.5% of mortgage loans should be given to women.

To date, women borrowers received 35% of total 16,050 mortgages provided through the program. Efforts to secure property rights for women serve a dual purpose. Ownership provides tangible material benefits, but also fosters intangible values and mindset shifts that can form the foundation of gender equality.

Says Umida: “Having a roof over my head fills my heart with hope and confidence for the future, not just for myself but for my children too.”

By Adham Kuchkarov, Senior Private Sector Development Officer, Uzbekistan Resident Mission, Central and West Asia Department, ADB