Online loans spurred growth in short-term microfinance

The online lending system is changing the structure of the microfinance market in the republic. According to the National Statistics Committee, in the first half of the year, the share of microloans issued for up to three months grew to 18.9%, although a year earlier it did not exceed 7.5%.

This is due to the active development of digital platforms of microfinance organisations, which allow you to obtain a loan remotely — often in a matter of minutes. Such loans are especially in demand among those who borrow small amounts for urgent needs. Thus, online lending has not only accelerated the population's access to financial resources, but also changed the behaviour of borrowers.

In the first half of the year, microcredit organisations issued 567,200 loans worth 40.2 billion KGS. This is 34.4% more than a year earlier. Loans with terms of one to three years remain the most popular, accounting for 38.6% of the total portfolio, while loans with terms of six to twelve months accounted for 27%.

Women remain the main customers of microcredit organisations, accounting for 55.8% of all borrowers.

The money received from microfinance companies is used for:

• consumer needs — 61.2%;
• agricultural development — 16.3%;
• trade and catering — 9.9%;
• transport — 3.2%;
• domestic services — 2.6%;
• construction — 2.4%.