THE IMPACT OF DIGITAL PAYMENTS ON PRIVATE SECTOR DEVELOPMENT IN UZBEKISTAN
DOI:
https://doi.org/10.68549/hc8tvj57Keywords:
digital payments, private sector development, small and medium-sized enterprises, formalisation, shadow economy, cash-flow-based lending, e-commerce, unified QR code.Abstract
This article examines the relationship between digital payment expansion and private sector development in Uzbekistan using data from the Central Bank, National Statistics Committee, tax authorities, World Bank Enterprise Survey and e-commerce sources. Applying a mixed-method approach, the study analyses trends in 2021–2025 and evaluates four transmission channels. POS payment turnover increased approximately fourfold, from UZS 112.4 trillion to UZS 460.3 trillion, while its share of nominal GDP rose from 13.1% to 24.9%. The estimated shadow economy declined from 45–50% of GDP in 2019 to 33% in 2025, although causality remains unproven. Despite e-commerce growth, financial inclusion remains limited: over one-third of MSMEs lack bank accounts, and access to credit remains low. The findings indicate a relatively strong formalisation channel, moderate transaction-cost and market-access effects, and a weak information-and-credit channel. The study recommends prioritising interoperable payment systems, affordable merchant services and responsible cash-flow-based lending to strengthen MSME development.
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