Considered to be the poorest region of the former Soviet Union, the development of Tajikistan relies heavily on loans via microfinance, particularly in the rural areas of the nation.
Yahyo Boboev is a 28-year-old resident of Vakhsh district. For many years, he worked in Russia and made a living at the expense of labor migration. He no longer wanted to go to foreign lands and work away from his family. He planned to open his own trading business in his provincial district. At first, he was selling watermelon and gradually increased his business and opened a grocery store.
Habi is a talented craftswoman, engaged in embroidery of skullcaps for 4 years. Thanks to her activity, she care of her family needs. She lives in Tursunzade town with her husband and two children. Her husband works at an aluminum plant of the town since 2006 and helps his wife with providing their family.
She was born in 1958 in a farmer's family. Even from a young age, she was interested in the work of her parents, and helped them in livestock and agriculture.
Minavar is married and mother of three children. She has a son and two daughters. The members of her family actively help her in her work. More than 8 years ago, Minavar engaged in cattle breeding and plant growing. She likes to look after animals and work in the fresh air.
Two years ago, Solehjon wanted to expand his trading business and that’s why he applied for a micro credit. On October 28 of 2015, he got his first loan in the amount of 3,500 TJS and made a lot of profit that allowed him to repay the loan on time.
In September 2016, he took a second loan in the amount of 10,000 TJS to expand his trading business. With his father and brother, he opened another retail outlet for the sale of flat cakes.
Her parents raised 4 daughters and 3 sons helping them with their orientation. Her father has a grocery store and he is engaged in food selling.
Mosharif is a smart and sociable young woman. Before her marriage, her sister taught her how to sew and she learnt her craft in a couple of month. To thank her, she gave her the first dress she sew and she was very delighted with this beautiful gift.
The HUMO microfinance institution in Tajikistan has just celebrated its 12th anniversary! Created on 24 December 2004, the institution has experienced two crises with many successes and failures.
Despite those difficulties, a large number of projects were launched this year, such as the restructuring of the organization, a project with the credit department of the BFC bank and many small projects in the information system.
Saidburhon live with his wife, unemployed and their four children, 2 of which are going to school. He is welder but did not have enough money to buy a welding machine, so he was unemployed during a long and difficult period.
Wishing to provide good living conditions for his family, he decided to go to Russia in order to find a job. With these thoughts, he took the train and suddenly saw an inscription that catch his attention on the transport window: “MDO Humo : from dream to reality.”
Davlat Ganjaraev, 34 years old, lives in Zarbdor village with his wife, one child and his old parents. Their living conditions were very difficult, he was unemployed, and he did not have the financial ability to go abroad for labor migration. One day at the market, he heard a conversation of loan officers from MFI HUMO, and once he received information, he decided to apply for a loan to start livestock business.
In August 2015, he got his first loan in the amount of 5,000 TJS. By laboring and making efforts every day, Davlat set aside some profit and renovated his home.
Habiba Ashurova is living in Kurbantyube, the fourth largest city in Tajikistan. She is working in farming, and during the spring, she cultivates tomatoes and cucumbers in greenhouses.
Nodira was born in a district of Jamoat in 1994 and is still living there with her son. Her husband works in Russia and sends her money but it’s not enough for covering all the expenses of the family. In 2015, Nodira and her mother decided to rent a premise to open a restaurant in the district. In August, they were helped by the MFI HUMO and obtained a loan of 2000 dollars. They used part of the loan to buy tables and chairs and the other part for cooking dishes.
Social and Economic Context
Tajikistan is a relatively unknown country which became independent after the collapse of the former Soviet Union in 1991. It shares frontiers with Afghanistan to the south, Uzbekistan to the west, Kyrgyzstan to the north and China to the East. The poorest country in Central Asia and the former Soviet Union, certain particularities demonstrate the rich history of the region. Indeed, the Tajiks are the only people in Central Asia who do not speak a Turkish language. Tajik is a Persian language closely resembling the Persian dialect spoken in Iran and Dari, spoken in Afghanistan, but it is written in the Cyrillic alphabet which was adopted by the Russians at the time of the annexation at the end of the 19th century.
Its recent history is marked by a civil war which began at the time of the break up of the Soviet Union resulting in the loss of nearly 50 000 lives. Today the Republic of Tajikistan is still considered by international observers to be relatively unstable, and its institutions, beset by problems caused by the country’s poverty, are very fragile. Corruption often proves to be an obstacle to the development of the country’s fair trade. However it should be noted that education is guaranteed for all and statistics show that literacy in the country is at almost 100%. Geographically mountains account for 93% of the country and its climate is very continental as the sea is situated thousands of kilometres away.
The Tajiks claim to be heirs of the Samanid Empire which was the first Persian state to be reformed after being conquered by the Arabs in the 7th and 8th century. The Samanid Empire was the birthplace of towns such as Bukhara and Samarkand which developed thanks to the tradesmen who passed through them travelling on the Silk Road. The Samanid Empire was gradually invaded by Turkish tribes from Central Asia and the Altai Steppe (territory which today is shared between Mongolia and China) but it is Persian culture which continues to dominate the region.
The present day Tajikistan was conquered by the Russians in the 19th century representing the Southern limit of Russian influence in Asia at that period. The Republic of Tajikistan was created in 1924 and was an integral part of the Soviet Union at the collapse of which a violent civil war broke out, lasting from 1992 until 1997, opposing the partisans of the ancient communist regime to several opposing parties, ranging from liberal democrats to Islamic groups. The opposition finally seized control and the president and the government have remained in power since 1997, upheld by two elections in the 2000s which, according to international observers, were tainted by corruption and fraud.
Overall Tajikistan’s culture and language is Persian. The majority of the population are Sunni Muslims. The Tajiks have adopted certain elements of Russian culture which were predominant in the region for over a century particularly the fact that the Tajik language is a Persian language written in the Cyrillic alphabet. Other Turkish ethnic minorities can also be encountered (Uzbeks and Kyrgyzs). The Pamir Mountains cover the main part of the country to the east and the south and the inhabitants speak a variety of Pamir languages which today are considered in danger of becoming extinct since they are only spoken by a few hundred thousand people.
Microfinance in Tajikistan
Tajikistan is a country with very few banking facilities. Microfinance plays an important role, especially in rural areas where microfinance institutions are often the only means for the population to obtain financial services. There are around forty institutions present in the country, and our partner HUMO is classed fourth in terms of serving the population.
|Republic of Tajikistan|
|Anthem: Surudi Milli
(and largest city)
|Official language(s)||Tajik |
|Language for inter-ethnic
|Government||Unitary semi-presidential republic|
|-||Prime Minister||Oqil Oqilov|
|Independence (from the Soviet Union)|
|-||Establishment of the Samanid Empire||875 AD|
|-||Declared||September 9, 1991|
|-||Completed||December 25, 1991|
|-||Total||143,100 km2 (102nd)
55,251 sq mi
|-||2010 estimate||7,995,754 (96th)|
|GDP (PPP)||2009 estimate|
|GDP (nominal)||2009 estimate|
|Gini (2004)||33.59 (medium)|
|HDI (2007)||0.688 (medium) (127th)|
|Time zone||TJT (UTC+5)|
|Drives on the||right|
|ISO 3166 code||TJ|
|1||Estimate from State Statistical Committee of Tajikistan, 2008; rank based on UN figures for 2005.|
HUMO is a microfinance institution in Tajikistan. Established in the east of the country where the majority of the population is concentrated, the institution has a dozen branches spread over the rural areas of the country. The institution serves a little over 13 000 clients by means of loans which are mainly distributed to groups of borrowers wishing to develop agricultural activities (livestock farming and sales, cultivation of various products) or small businesses (mainly market vendors or cottage industries).
HUMO’s mission is “to provide quality financial services which are easily accessible to the agricultural population of Tajikistan, as well as helping to facilitate the expansion of small and medium sized businesses in the republic of Tajikistan.”
HUMO combines its ambition to become one of the main players in the sector of microfinance in Tajikistan (today it is the 4th largest institution) with the objective of controlling expansion, by closely monitoring its clients’ situations and promoting transparency in the sector particularly so that the risk of the population falling into excessive debt is avoided.
“HUMO and Partners” arose from a microfinance programme initiated by CARE, an American NGO. At the end of 2004 the programme was transformed resulting in a microfinance institution being registered with the Tajik authorities.
Historically HUMO’s mission is to serve the farming populations using a group methodology. These groups, composed of between 3 and 10 people (of whom a president and a treasurer are nominated) are set up prior to the loan request being made. The groups then meet in order to take part in an orientation session introducing them to the principles of microcredit, which enables them to obtain access to a loan which finances an income generating activity. Each member receives an individual loan and acts as guarantor on a group level for all the other members of the group. Since quite recently HUMO distributes individual loans which are often targeted at clients with a more stable and substantial economic activity.
At the end of 2008, HUMO received from the Tajik Bank a licence accorded by the Central Bank of Tajikistan and hence modified its status from an NGO to a “Non- bank financial institution.” This new status enabled it to obtain more funding and thus expand further.
In 2009, Tajikistan was hit by the financial crisis. Since a large proportion of its domestic income was dependant on Tajik emigrants residing in Russia, (over a million out of a total population of approximately 7 million), the country was beset by a serious recession which affected HUMO’s clients’ business activities. The institution, considering the high risk of non-repayment of loans and excessive debt involved for its clients, decided to drastically reduce the number of loans being disbursed. Today the recession is over and HUMO has begun to expand again, setting up new branches in the North of the Country.
ActivityHUMO allocates group or individual loans to help the development of agricultural ventures (livestock farming, cultivation) and businesses (merchants, cottage industries or services).
The profile of entrepreneurs
Tajikistan was part of the former Soviet Union. Many of HUMO’s clients have progressed from the status of employee in factories to being self-employed in all types of activities, for example taxi drivers, cobblers, market traders… A large proportion of HUMO’s portfolio focuses on agricultural ventures, particularly livestock farming which is often complementary to other economic ventures, for example a certain quantity of HUMO’s clients are school teachers.Humo's website : humo.tj
|Legal status||NBFI (Non-Bank Financial Institution)|
|Number of borrowers||12,478|
|Size of loan portfolio||$7,915,344|
|Average loan balance||$634|
|Average borrower interest rate||3.6% per month|
|Total number of staff||225|
|PAR (Portfolio at Risk)||1.79%|