Open Bank receives Uzbekistan's first Islamic banking licence

First Islamic banking licence

Uzbekistan has issued its first licence for Islamic banking activity. It went to Open Bank — one of the country's youngest banks. It will now be able to carry out Islamic financial transactions and introduce new products, such as ijara — Islamic leasing of property with an option to buy. This is reported by Spot.uz.

How the country reached its first licence

The journey took several years. Islamic finance was first legalised in 2022, when Islamic products were allowed for microfinance organisations. Banks received this opportunity later: the president signed the law on Islamic banking in March 2026. Less than four months passed between the law's entry into force and the issuance of the first licence — in that time the regulator had to build the secondary legislation, licensing requirements and Sharia governance. A council on Islamic finance has been established under the Central Bank. council on Islamic finance.

What is planned and who is next

The regulator expects at least 10 Islamic banks to appear by 2030, along with 'Islamic windows' in three state banks; for 2026–2030, around $1 billion in investments and deposits is planned to be attracted through Islamic banking. According to the Central Bank, more than ten commercial banks are preparing to introduce Islamic finance: Agrobank, Asakabank, Ipak Yuli Bank, Orient Finans Bank, Hayot Bank and Apex Bank have spoken about their plans. In June, Agrobank's shareholders approved the introduction of Islamic banking services, while Asakabank's shareholders approved the creation of an Islamic window. Experts interviewed by Spot.uz note that naming the next licence recipients is premature: the timing depends on each bank's readiness and on Central Bank decisions.

Which products will appear first

The licence confirms the bank's right to Islamic activity in general, but does not mean the entire product line is ready for launch: obtaining a licence and launching products are two separate stages. Experts expect a phased market entry, starting with murabaha — financing of goods purchases with a pre-agreed mark-up and instalment plan. According to the Central Bank, murabaha accounts for about 63% of Islamic microfinance volume in the country, and consumers are already familiar with the instalment model. Next could come the development of Islamic leasing (ijara), partnership financing and investment deposits. In the future, clients will be able to obtain business financing, consumer financing and Islamic mortgages, and place money in Islamic deposits.

Risks and limitations at the start

Experts interviewed by Spot.uz name three main challenges. The first is Sharia compliance: Islamic banking must not boil down to renaming ordinary loans; what matters are the real economic structure of transactions, risk-sharing and independent Sharia oversight; in murabaha, for example, a genuine sale of the asset with proper primary documentation is required. The second is capital and personnel: access to long-term funding and a shortage of specialists combining expertise in banking, law, risk management and Islamic financial standards could constrain growth. The third is client expectations: Islamic financing does not mean free of charge, and with investment deposits the risk is borne by the depositor, which may deter some clients where financial literacy is low.

More expensive or cheaper than conventional loans

Islamic products will not necessarily be cheaper than conventional loans: the difference lies in the structure of transactions and the principles of risk-sharing, not in a guaranteed low cost. At the initial stage, due to limited funding, the lack of economies of scale and additional operating costs, some products may turn out to be more expensive than their conventional counterparts. At the same time, the law provides for a special tax regime, including exemption from VAT of the trading mark-up on certain Islamic transactions, which removes one barrier to price competitiveness. Experts also warn of the risk of 'wrong products' from the banks themselves — for example, tawarruq and commodity murabaha — under weak Sharia oversight, and note that recent events surrounding IMAN Invest could negatively affect the reputation of Islamic finance, even though the banking sector is tightly regulated.