Procedure for Providing Preferential Loans Updated

The Central Bank of Turkmenistan has approved a new Procedure for providing preferential loans to agricultural producers.

The document was approved by an order of the Chairman of the Central Bank dated August 24, 2026, and was registered by the Ministry of Adalat of Turkmenistan on September 16.

The new procedure replaces the previous rules approved by the Central Bank on November 30, 2018. The earlier document has been declared invalid.

Preferential loans may be obtained by dayhan associations and dayhan farms, agricultural joint-stock companies, agricultural research institutes, owners of land plots, land users, land tenants, private entrepreneurs producing agricultural products, and non-state legal entities registered in Turkmenistan.

Loans will be issued by authorized credit institutions of Turkmenistan, with the exception of credit institutions operating in the country with 100% foreign capital. Lending may be carried out in both national and foreign currency.

Loan funds may be provided for the purchase of agricultural machinery and equipment, excavators and bulldozers, water-saving machinery and equipment, irrigation pipelines and transformers.

Loans may also be used to implement investment projects related to livestock and poultry farming, the production and processing of agricultural products, payment for services, and the purchase of fixed assets and property.

The use of loan funds to cover losses, pay fines, manufacture tobacco products and alcoholic beverages, or create working capital for trading and intermediary enterprises is prohibited.

The annual interest rate for borrowers is set at 1%, with a loan term of up to 10 years.

Loans obtained for the purchase of machinery and equipment must be repaid annually in equal installments. The borrower must finance at least 15% of the total project cost from their own funds.

A grace period may be granted for investment projects, and such projects may also be financed in stages.

The Central Bank enters into loan agreements with commercial banks to provide credit resources at an annual interest rate of 0.5%.

For loans used to purchase machinery, collateral of up to 70% of its value may be accepted, while the borrower’s expected future income is taken into account for the remaining portion.

For certain categories of borrowers, collateral, a bank guarantee, or a third-party guarantee may be accepted as loan security. For dayhan associations, income received from all types of their activities serves as security.

To obtain a loan, an applicant must submit an application to the bank, registration documents, a business plan, documents related to the land plot, and, depending on the category of borrower, information on income for the previous two or three years.

The bank must decide whether to grant or refuse the loan within 15 working days from the date the application is registered. In the event of refusal, the reasons must be provided in writing.

Loan funds are transferred in non-cash form to a separate loan account. Payments may be made from this account according to the borrower’s payment orders, and foreign currency may also be purchased to make payments to non-residents under foreign trade contracts.

Banks are required to inspect the targeted use of loan funds on site and submit monthly reports to the Central Bank of Turkmenistan, including lists of loan recipients.

If loan funds are not used for their intended purpose, the bank may recover the relevant amount from the borrower’s accounts ahead of schedule. If loan payments are overdue, the bank has the right to terminate the agreement and demand early repayment of the remaining loan balance.

The document identifies the main objectives of supporting agricultural producers as increasing crop yields, developing unused land, expanding the production of import-substituting goods and exports, creating new jobs, and increasing the incomes of agricultural producers.