Microsoft Word Microfinance development in Uzbekistan Eng doc

Entrepreneurs owning small businesses and registered as microfirms as well as 
entrepreneurs without the status of legal entity 
MFO clientele scale assessment among microfirms. From the point of view of size, 
legislation
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and government statistics single out the following basic categories of small 
businesses: 
- individual entrepreneurs; 
- microfirms with the average number of employees in the manufacturing sector not 
more than 20 people annually, in services and other non-production branches – not more than 
10 people annually, in wholesale, retail sale, and catering – not more than 5 people annually; 
Small enterprises with mean annual number of employees employed in the following 
industries: 
- textiles and food processing, metal processing and instrument making, wood 
processing, furniture and construction materials industries – not more than 100 people; 
- machinery manufacturing, metallurgy, fuel, energy, and chemicals, agriculture and 
processing of agricultural products, and other industrial and manufacturing sectors – not 
more than 50 people; 
- research, science services, transportation, telecommunication, services (except 
insurance companies), commerce and public catering, and other non-manufacturing sectors – 
not more than 25 persons. 
As a rule, legal entities with up to 10 employees are counted as microenterprises for the 
assessment of potential clientele of the most typical MFOs.
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The same methodological 
approach has been applied in this calculation. Polling results show that the number of 
personnel in microenterprises regardless of the industry ranges from 2.7 to 9.7 people, i.e. 
less than 10 employees (Table 3 Appendix 1 to the report). Thus, all microfirms are included 
into the clientele base. According to survey results from 2004, the number of microfirms in 
Uzbekistan was 259,300.
Small enterprises do not usually make up part of the MFO clientele base. Generally 
speaking, they are bank clients as they need larger loans.
For a more accurate assessment of the scale of microfirms as a component of MFOs’ 
programmes it is necessary to adjust the figure for those microfirms that do not have needs 
for external financing: about 20%, according to poll results. Taking into consideration this 
adjustment, the most realistic size of clientele base of MFOs among microfirms may be 
estimated around 207,400. 
It should also be taken into consideration that microfirms may apply to banks for loans. 
The share of such microfirms also makes up about 20%. Taking into account this last 
adjustment, the number of potential microenterprise MFO clients comes to 155,600.
When speaking about securing access to financing for these enterprises it is important 
to mention that in fact indirect support is provided to 989,900 persons employed in 
microfirms with up to 10 employees. 
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Decree # UP-3305 of the President of the Republic of Uzbekistan “On making changes and amendments to 
the Decree of the President of Uzbekistan’ issued April 9, 1998 “On measures for further encouragement for 
development of private entrepreneurship, small and medium businesses”. 
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These criteria are active in Europe. This limit was determined by FINCA International LLC in the project 
“Analysis of the state of supply and demand in the market of microfinance services”. 

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