Buy now, pay more: Hidden costs of installment plans raise concerns in Uzbekistan

Surge in interest among youth

According to the study, Google searches for the term “rassrochka” (installment) — both in Latin and Cyrillic scripts — have seen a sharp rise since late 2021. The majority of these searches are made using the Latin script, suggesting a strong interest from younger demographics.

Retailers inflating prices

The Central Bank highlighted that vendors are significantly marking up prices for installment plans. For example, purchasing an iPhone 16 Pro Max (256 GB) on a 12-month installment plan may lead to a markup ranging from 27.3% to 44.3%, with an average overpayment of 39.6%. When converted to an annual interest rate, this equals 47.1%–73.8%, averaging 66.5%.

One example from the online store Brostore.uz shows the phone priced at 17,770,000 UZS with a 30% down payment (5,331,000 UZS). The remaining 12,439,000 UZS is paid in 12 monthly installments of 1,805,254 UZS, totaling 26,994,050 UZS — a markup of 51.9%.

Another retailer, Idea, claims to offer 6-month installment plans without extra fees. However, it lists an iPhone 16 Pro (128 GB) for 21,990,000 UZS — 52.4% above the market average of 14.4 million UZS.

Who offers installment sales?

As of December 2024, 307 retail entities (including 53 individual entrepreneurs) are partnered with the Credit Information and Analytical Center to offer installment sales. Regional distribution is as follows:

• 36.2% in Fergana region
• 23.2% in Tashkent city
• 12.6% in Namangan
• 7.5% in Andijan
• 5.5% in Tashkent region

The lowest participation was in Syrdarya (1.2%), Jizzakh (0.8%), and Surkhandarya (0.4%).

By type of business:

• 37% – household electronics retail
• 25% – general goods retail
• 11% – communication devices
• 8% – furniture and household items

Between 2018 and 2024, total market revenue rose from 8.1 billion to 201.3 billion UZS — a 25-fold increase. The largest jumps occurred in 2022–2023 (+35 billion) and 2023–2024 (+94 billion). Over the same period, total bank loans obtained by these businesses increased 52 times — from 22.3 billion to 1.17 trillion UZS.

Who buys on installment?

The Central Bank also analyzed the demographic profile of installment buyers (based on anonymized data from two companies):

• 63% of customers are under 35.
• Among men: 72% are under 35; among women: 53%.
• In 2024, these companies served 1.9 million clients — 1.1 million men and 0.8 million women.
• One company alone had 1.7 million unique users.

As of January 1, 2025, 777,500 users also held active bank loans, 68.7% of which were microloans.

The highest average contract amount was among men aged 51–65 (2 million UZS); for women, it was 1.7 million UZS. Young people (ages 18–25) took out installment plans averaging 900,000 UZS.

27% of all installment buyers reside in Tashkent city or Tashkent region.

In 2023, an average buyer had 2 active installment contracts; by 2024, this had risen to 3. In Tashkent, the average reached 4; in Namangan and Andijan — 2.

Breakdown by number of contracts:

• 52.1% of clients have 1 contract
• 17.7% have 2
• 4.4% (82,000 people) have more than 10 contracts

The Central Bank warns that while installment plans stimulate consumer spending, they also pose significant risks — from hidden debt burdens to broader threats to financial stability. The regulator stressed the need to establish clear legal and financial frameworks to regulate this rapidly growing market.

Previously, Kun.uz conducted its own investigation into the risks of installment-based sales.