Since it arrived in Uzbekistan in 2020 by taking over a fintech payment system, Georgia’s TBC has taken the market by storm. The country’s only pure digital banking ecosystem that includes the country’s largest branchless bank has grown by leaps and bounds and today serves more than half of Uzbekistan’s population. Competition is now rising as the development of the sector is accelerating, but TBC Bank Group’s Chief Growth Officer Oliver Hughes, one of the most famous bankers in the global fintech space, told bne IntelliNews in an exclusive interview that the bank is ready for the challenge.
TBC Uzbekistan, part of London-listed TBC Bank Group, has 19.7 million users, according to the latest reporting period. It is the leading digital banking ecosystem in Uzbekistan.
“TBC is the largest bank in Georgia and has been about for around 30 years. It has a large business and is very profitable with a fully digitised offering – a full banking service with retail, corporate, the full gamut – but Georgia is a small place with only 3.7mn people, so the TBC crew asked: "Where do we go now?” Hughes told bne IntelliNews during the Tashkent International Investment Forum (TIIF) on June 13. “I call them “commercial Vikings”: they got into the longboat and off they go.”
Uzbekistan was an attractive market. Following the elections of Uzbek President Shavkat Mirziyoyev in 2016 the country was opening up after the president launched what he has dubbed Uzbekistan “third renaissance” with a swath of liberal economic reforms that has seen the economy boom. Reforming the banking sector was very high on the priority list. To cut a long story short: over the past five years, the capital of Uzbekistan's banks has doubled, while the lenders' loan portfolios have expanded by 2.3 times and their annual lending volumes have surged by 1.8 times.
Hughes is well-known in the region, despite being born in the UK. Raised in Lancashire, he studied Russian and French at the University of Sussex and received a Master of Arts degree in International Politics from Leeds University and a Master of Science degree in Information Management and Technology from City University in London. Oliver found himself in Moscow in the early 1990s where he went to work for VISA for a decade that was building up its Russian business, before he was headhunted to run Tinkoff bank in 2007, Russia’s first ever purely digital bank.
Tinkoff, which started as a credit card issuer, was an outstanding success. Shorn of costly overheads like a branch network, it later began paying high deposit rates, irresistible to the banking-savvy Russian consumers that used high paying bank deposits to protect their savings from the ravages of perennial high inflation as their main store of wealth. Initially dismissed by the larger banks as a flash in the pan, Tinkoff bank became a force of nature and forced the incumbents to change their strategy and imitate Tinkoff.
In 2022 the founder, serial entrepreneur Oleg Tinkov, became one of only two oligarchs to publicly criticise Russian President Vladimir Putin’s decision to invade Ukraine and was forced to sell the bank to Russian oligarch Vladimir Potanin for a reported “kopecks on the ruble.” Tinkov is now spending most of his time in Mexico, where he has launched a fintech venture.
Hughes left Russia following the invasion of Ukraine in 2022 and was quickly snapped up by TBC a year later, which was already working in Tashkent. Fitch Ratings initiated full coverage of the Uzbek bank a year later in 2024.
“TBC Bank Uzbekistan achieved profitability just two years after launch – a record time-to-profit among global digital banks,” Hughes said at the time.
TBC a perfect fit for adding value
As reported by bne IntelliNews, the LSE-listed TBC Bank Group confirmed that its subsidiary TBC Bank has been granted a banking licence by the central bank of Uzbekistan in April 2020 and launched banking operations in the Central Asian country that October This followed TBC’s initial entry into Uzbekistan via the acquisition of a controlling stake in successful local fintech startup Payme in 2019, which TBC then took full control of in 2023.
TBC CFO Giorgi Shagidze told bne IntelliNews in an interview earlier the same year: “Retail and MSME banking penetration in Uzbekistan is quite low, so we will be targeting those segments. We will not be targeting corporates as customers or wealth management clients. We will be leveraging our digital capabilities.”
TBC is a perfect fit for Uzbekistan. While bank privatisation is high on the government’s agenda, progress has been slow as the government has been picking its partners carefully. Unlike in Central Europe, where countries simply sold off most of their banks to Western European banking groups – especially German and Austrian banks – one of themes shot through Mirziyoyev reforms is that any foreign partner should add some specific value to its sector, not just make profits.
Kazakhstan’s Halyk bank, Turkey’s Ziraat Bank and South Korea’s KDB Bank have Uzbek operations as both countries are major trade partners. Germany’s Hamkorbank-ProCredit set up but is a quasi-development bank that supports SME lending. Hungary’s OTP Bank bought Ipoteka bank in 2023, a mortgage specialist. Russia’s retail banking giant Sberbank has an office in Uzbekistan, but as Tashkent is very conscious that the giant Russian banks could swamp the market, Sberbank’s operations are limited to supporting Russian business and it has not been granted a retail banking licence, its main business is Russia. And TBC entered with its eye firmly fixed on developing digital banking.
Getting local
Hughes says that TBC initially focused on building up a retail business based on a digital branchless bank and grew quickly, but once it had built up some momentum it started offering digital personal loans. “That was the disruptive part,” says Hughes. Since then the bank has expanded and is increasingly focused on developing products for consumers and SMEs.
“SME are super important and a huge opportunity as they are an under serviced segment,” says Hughes. “Now we have 20mn unique registered users – six times the population of Georgia – and 6mn monthly active users (MAU). TBC Uzbekistan has USD 777mn USD in total gross loans and USD 440mn in total deposits as of 1Q, 2025 and growing very quickly: loan book doubles every year for the last few years and we are guiding for $75mn profits in this year.”
Like with the organised retail sector, Hughes says that despite his experience with developing a Russian business, Uzbekistan is home to various cultural quirks and “a cookie-cutter approach won’t work.”
“One-size-fits-all doesn't work. Some businesses are as local as you can get. You have to localise. You have to go deep. You need to understand the regulatory environment and understand your consumer,” says Hughes. “It's an emerging market, but it is very welcoming. There is good infrastructure, good talent and it is a place where other people want to work.”
Regulatory environment
Hughes says the government has been proactively listening to bankers and the banking sector regulatory environment is very pro-business.
“There is a quasi-open banking sector. It’s ahead of many western banking sectors and is an enabler for a digital player,” says Hughes. “It’s a data-rich and digital environment. That helps as we can do our KYC, the full thing, end-to-end KYC, digitally, which you can’t do in Russia where you still need physical meetings.”
The open banking environment is good for the sector as it promotes competition and transparency. The market is open to new players, says Hughes, and keeps the incumbents on their toes.
“You are allowed to experiment, innovate and test things out. Uzbekistan is very good at doing this and things can quickly change in this environment,” says Hughes. He highlights Uzbekistan’s first tech unicorn Uzum, an e-commerce player that is getting into fintech, but says that it is not a competitor, even though the two businesses will eventually start to overlap.
“Local players, foreign players, have mobile apps that rapidly improve the experience for the customers. This fosters competition and that raises the bar for everyone,” says Hughes. “There are a set of trade-offs: not to bite off more than you can chew and being executional[ly] excellent. Do what you do, but do it well. You need to be two or three steps ahead to bring in new customers. A “future factory” where you are constantly rolling out new products and services. The importance of execution and sequencing is huge.”
Funding
During his presentation at TIIF, the directors of Navoi Mining and Metallurgical Company (NMMC), Uzbekistan’s gold mining national champion, Eugene Antonov, stood up to ask a question: why the very generous 25% interest rates on deposits was starting to come down. The high interest rates is one of the biggest appeals in banking with TBC.
Hughes explained that TBC launched with high rates to attract capital quickly, “and that is expensive.” The bank adopted a high return on equity (ROE) model, “so that he [doesn't] have a problem with capital.”
“The more we scale, the bigger we get as the level of confidence grows, then the premium we pay to the market narrows,” says Hughes. “Now we also have other sources of revenue from SMEs. Now we have bonds which are cheaper than retail deposits. But we still pay 23% [on retail deposits], which is a good number.”
TBC Uzbekistan tapped the capital markets in June with a $200mn synthetic three-year bond to accelerate its growth. In the fast growth phase of Russia’s retail banking business in the noughties wholesale funding became a very popular way to finance the rapid growth of the consumer loan business and Uzbekistan seems to be reaching the same stage in its development.
AI plans
Next up the bank is developing its own AI to keep ahead of the game. This is exactly the sort of added-value addition that the government was looking for when choosing its foreign partners.
“There is a lot going on in the fintech and tech scene but not lots in AI. It is hard to build and it is hard to find the right people,” says Hughes. “We have already spent $10mn in building our AI out and there is a lot of work still to do.”
TBC has skipped over the earlier stages pioneered in Western banks and gone straight to speech, a major challenge in a country like Uzbekistan, but this is where being a purely digital bank becomes a major advantage: TBC has a ton of data to work with.
“We took millions of calls and texts from our customers because Uzbekistan has “only” 38mn people to build our own synthesiser,” says Hughes. “But there are local quirks that make the problems unique.”
Uzbeks speak their own language, a Turkic language, but because of the Soviet legacy, they mix in Russian words and there are several dialogues and regional languages from the various ethnicities that make up the Uzbek nation and the general mixing of ethnicities that are a legacy of Stalin’s arbitrarily drawing of borders when the Soviet Union conquered the region. Stalin purposely drew borders through the middle of ethnic homogenous regions to prevent any Central Asian region building a sense of national identity that could result in an attempt to succeed or assert itself within the Union of Socialist Republics – divisions that remain to this day.
“We have to deal with Karakalpak, Tajik, Uzbek, Persian as well as Russian,” says Hughes. “And people have a tendency to mix all these languages together when they speak. Moreover, they switch and mix between Latin, Cyrillic and Uzbek scripts. It makes it really hard to build a speech-based AI.”
But now the speech synthesiser is working and TBC has also deployed a text bot on its Telegram app – Uzbekistan is the largest market on Telegram which is used by 70%-80% of the population – it is already bringing in new customers: the sales bot has a 30% better conversion rate in Telegram.
``We are working on an in-app AI assistant, which you can talk to in real time,'' says Hughes. ''This is what we are working towards, so that we could use this technology to make an assistant that travels to other apps or just keep it in-house. We haven’t quite decided this yet.''
“Uzbekistan is becoming a tech hub, but to become a global tech hub it needs more training. It needs to be scaled and we need more data centres. There is going to be a long lead time,” Hughes adds. “We need an Uzbekistan cloud and we can’t offshore, because of the local legislative restrictions.”
Corporate lending
TBC’s focus is on retail banking. For business, the bank is also targeting the SMEs, but Hughes says he has little interest in going after corporate customers, apart from some B2C and B2B services.
“We have a lot more verticals to build. We launched SME accounts at the end of 2024 and introduced SME capital loans a few months ago. Autoloans are also coming as well as secured lending. And we will get to a brokerage for retail investors at some point. Will we chase corporate banking? No. Will we open branches? No. We know what our core business is and we will stay there.
