Uzbek President Shavkat Mirziyoyev has approved the creation of "mahalla bankers," a new initiative to assist budding entrepreneurs. This was discussed at a meeting on poverty reduction chaired by the president, Fergana reports.
"Mahalla bankers" will identify entrepreneurial opportunities in local areas, engage with residents, and help turn ideas into viable projects. They will also advise on business setup, obtaining loans, and repayment processes.
The initiative stresses close collaboration between banks and district governors. Banks will oversee financial issues related to business startups, while governors will be responsible for providing land, facilities, and necessary infrastructure to entrepreneurs.
It is to be noted that similar practice was launched by the Aga Khan Foundation (AKF) and the United States Agency for International Development (USAID) in Tajikistan in 2021 through establishing community-based savings groups (CBSGs) in rural areas of the country through two programs: Economic and Social Connections: A Multi-Input Area Development Financing Facility for Tajikistan and the Thrive Tajikistan: Partnership for Socio-Economic Development.
A Community Savings Group is a community-based lending program. A group of people in a community agree to save a certain amount periodically and deposit these savings in a group account. This money is then lent over the course of one year based on demand, after which the loans need to be repaid.
The CBSGs support the Government’s aim of involving those in rural areas, particularly youth and women, in social and economic transformation, while reducing inequalities.
