Optimistic but without savings: Uzbeks tend to spend (and borrow) more
A survey conducted by the Uzbek Central Bank found that, despite widespread optimism about future income growth, nearly half of the respondents had no savings at all. The results reveal a telling gap between respondents’ current finances and their financial expectations.
The bank’s Q2 consumer sentiment review, based on around 4,100 responses collected in July, found that 46.4% had no savings, virtually unchanged from the previous quarter.
According to the Central Bank, they were unable to adapt to changes in income or cover unexpected expenses because of the results. The duration of respondents’ savings remained relatively unchanged as well.
Still, 64.3% of people anticipated an increase to their savings, and 66.0% anticipated a rise to their income. The report does not reveal how many people without savings thought things would get better.
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Spending and borrowing needs
Some 76% of Uzbeks expected their spending to increase, compared with 66% expecting higher incomes. These are separate survey totals: they do not establish that individual households planned to spend beyond their means.
Home improvements, education and medical treatment featured prominently. Lower-income respondents were less likely to plan spending on travel, cars or home purchases.
Borrowing needs remained widespread, as 55% expected their need for loans to increase, while 33% expected no change and 12% a decline. Among respondents earning 3–10 million ($255-849), between 57% and 59% anticipated greater borrowing needs.
That proportion fell to 44% in the 15–20 million soum ($1,270-1,700) group but rose again to 53% among those earning above 20 million ($1,270-1,700). The report linked borrowing plans to renovations, education and other needs, without establishing whether they reflected financial pressure or confidence in making larger purchases.
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Confidence softens, financial cushions barely change
Some improvement in respondents’ circumstances contributed to this optimism. An increase from 58% in the first quarter to 58.6% indicates that their financial situation has improved. But while 30.6% of shares showed no change, 10.9% of shares showed deterioration.
With a decline of 1.5 percentage points, 64.3% of respondents said they planned to raise their savings. At the same time, 23.4% anticipated no change to their savings, up from 11.9% the previous year, while 12.4% predicted a decrease.
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Results also varied according to income level. A whopping 81% of respondents with incomes over 20 million soum ($1,700) anticipated a rise in their earnings, which is a 3% increase from 77%. Those with incomes below 3 million soum ($255) were more likely to expect a decrease.
