Downscaling: Japan-Uzbekistan Small Business Programme (J-USBP)

The Japan-Uzbekistan Small Business Programme (J-USBP) of EBRD was an institution building project implementing lending to micro and small enterprises (MSEs) in selected commercial banks. The Technical Assistance Component was financed by the Japanese Government.

The J-USBP started with a pilot phase in early 2001. In this pilot phase, LFS assisted three commercial banks in building up micro lending departments in a limited number of regions, whereas the Partner Banks provided the necessary refinancing. In early 2002 a fourth bank joined the programme. In a second step, starting in July 2002, EBRD provided 8 million USD in credit line funds to Partner Banks for onlending to MSEs.

The J-USBP had a twofold objective. It strengthened the private enterprise sector by providing the necessary credit finance to MSEs, and increased the capacities of the financial sector to meet the needs of private enterprises. At the end of the project, J-USBP credit products were offered by 4 banks in 8 regions.

LFS was responsible for capacity building in the Partner Banks and overseeing and monitoring the quality of lending. In addition we provided advice to EBRD on selected impeding issues in the Uzbek legal and regulatory government. In this respect LFS liaised with both local and national authorities on a regular basis, for instance with local and regional governments or the Central Bank. LFS furthermore played an active role in the creditworthiness assessment of MSEs, and in the credit committee decisions of the banks. The Technical Assistance Component was financed by the Japanese Government.