The Central Bank of Uzbekistan updated its regulatory framework to introduce Islamic finance. The regulator amended eight existing acts to adapt traditional banking requirements to Sharia principles.
What happened
According to the industry channel FinTechRetail, the changes affect key operational processes at financial institutions. The list includes liquidity management rules, capital requirements, internal audit and bank inspection procedures, as well as the issuance of guarantees and payment of contributions to the Deposit Guarantee Fund.
The Central Bank also added direct provisions detailing the licensing of Islamic banking activities. The documents now formalize the concepts of investment deposits, Islamic financial instruments, financing policies, and the operation of Islamic finance boards.
Country and market
The new rules apply to commercial and microfinance banks in Uzbekistan that operate or plan to operate under Islamic finance principles.
This is an expected move for the market. The country is consistently developing alternative capital sources to attract investment from the Middle East and meet domestic demand from businesses and the public for Sharia-compliant financial services.
Why it matters
For a long time, the development of Islamic finance in the region stalled because traditional supervisory requirements clashed with Sharia principles—for example, regarding guaranteed deposit returns or credit risk assessment.
Updating eight acts at once shows the regulator is ready to move Islamic banking from conceptual discussions to real market products.
What next
Clear rules on investment deposits and Islamic instruments allow players to start developing and certifying specific retail and corporate services. For banks, this signals the need to prepare infrastructure and form internal Islamic finance boards.