Success story of “Ysmayil” household – the recipient of the guarantee of OJSC “Guarantee Fund”, narrated by USAID


Farmers and business owners in Kyrgyzstan face many obstacles. One of the most limiting is access to finance. Even with interest rates at around 30 percent, lenders often require collateral of up to three times the amount of the loan. Because of this, even the strongest businesses struggle to grow beyond small, family-operated enterprises.

Zuhra, a fruit farmer near Bishkek, the capital of Kyrgyzstan, faced this problem a few years ago. Her strawberry business was ripe to graduate from a small to a medium enterprise but everything hinged on getting the right equipment to do it.


Zuhra and her husband started farming strawberries in 2003. They began with barely a third of a hectare, but every year they managed to cultivate a bit more land. Over the years they expanded their cultivation to 20 hectares, but profitability stagnated because of the need to purchase shipping boxes, predominantly imported ones. Zuhra had a simple solution: make her own boxes. However, that meant securing a loan to build a small assembly line. She, like so many others, had little to offer as collateral for that.


To help entrepreneurs like Zuhra, USAID and its partners have established what are called guarantee funds in the country. A guarantee fund is simple: when serious and promising entrepreneurs do not have enough collateral to secure a loan, banks can ask the fund to guarantee repayment in case something goes wrong. It works as a form of insurance for the bank.


USAID first introduced the concept of a guarantee fund in Kyrgyzstan back in 2011 by supporting the creation of six small regional funds. Over the following few years, the USAID Collaborative Governance Program worked with the government, several banks, the parliament, and the private sector to improve the Law on Guarantee Funds so that small and medium businesses could easily access it.

Along the way, the government could see how the guarantee fund concept introduced by USAID could be beneficial for the country’s economy. So in 2016, it launched a national-level guarantee fund with its own money and contributions from private investors.

Since the national fund was launched in 2016 it has issued guarantees on 17.5 million USD worth of loans to more than 900 entrepreneurs who, like Zuhra, faced seemingly insurmountable obstacles.


After successfully obtaining a loan backed by the guarantee fund, Zuhra bought a second-hand assembly line and built a factory near her farm. It produces 5,000 boxes per day. Because Zuhra only needs 2,000 she sells the rest to other farmers.

Now, every day throughout the harvest season, Zuhra sends two trucks full of strawberries to neighboring countries.


To manage the growing business, Zuhra hired about 30 new staff. At the height of the harvest season, her seasonal staff can increase up to 90 people.

Jobs are scarce in Kyrgyzstan so at any given time, around 800,000 Kyrgyzstanis can be found working abroad. This is a lot of people for a country of only 6 million. Often, parents have to leave their children behind in the care of their elderly parents. This is having devastating consequences for families and communities across the country.

Every job USAID helps create in Kyrgyzstan means that a family can stay together and build a future at home.

We want to expand our operations to 200 hectares and buy our own shipping trucks. The next step for us is entering the bigger market outside the Central Asia region. It will require us to be able to come up with several tons of strawberries every single day, but I think that we can make it…

– Zuhra

Source: U.S. Agency for International Development