The Central Bank has issued recommendations urging commercial banks to weigh borrowers' interests and the possible social consequences when accepting a individual's only permanent home, where they and their family live, as loan collateral.

In such cases, banks were advised to first assess the borrower's ability to repay the loan carefully, avoid making the property's value and liquidity the main basis for lending, and consider other forms of security where possible.

The Central Bank said in a statement that lenders should primarily determine whether a client can repay a loan, and that the worth of the pledged home should not be the deciding factor in approving credit.

Before a contract is signed, clients must be told clearly that if the loan is not repaid, their only home could be subject to foreclosure and sold. If a individual pledges their sole residence to secure another person's or a business owner's loan, the home can be seized if the debt goes unpaid, even though the individual did not take out the loan themselves.

Once a debt arises, banks are advised to examine the borrower's financial situation and consider restructuring the loan or other ways of settling the arrears before pursuing enforcement.

"These recommendations do not prohibit pledging a sole residence as collateral. Their aim is to ensure that a client's ability to pay is properly assessed when such loans are issued, that possible consequences are explained in advance, and that responsible lending practices are strengthened," the Central Bank said.

The Central Bank's 2025 financial inclusion report found that 29% of bank borrowers in Uzbekistan hold more than one loan, averaging 1.7 loans per borrower.

In the first half of 2026, banks' total non-performing loans approached 23 trillion soums. State-owned banks issued more than 70% of the loans that turned problematic.