Lao financial institutions to access credit information
Lao financial institutions to access credit information
The Bank of the Lao PDR has created better conditions for financial institutes to access credit information, hoping the move will make it easier to provide loans to customers.
The central bank's Financial Institution Supervision Department and Information Technology Department held a seminar on the Credit Information Bureau (CIB) last week, aiming to provide the country's financial institutes access to credit information.
This information plays an import role for financial institutions to decide whether to release loans to customers. At present, most institutions find it difficult to access the required credit information, running the potential risk of not getting back loans and interest.
The central bank believes by assisting the country's micro financial institutions to run their business professionally, Laos' banking systems will remain healthy with non-performance loans below 3 percent.
According to a statement from the Bank of the Lao PDR, 58 representatives from micro finance institutes in Laos attended the seminar, an indication that the institutes want to improve their businesses to attract customers and run professionally.
A number of micro finance institutes have experienced a rapid increase in the demand of loans for small and medium enterprises (SME) in the past few years. Despite this the supply of loans for SME remains insufficient and the government is encouraging the establishment and expansion of these institutes.
Speaking at the opening ceremony of the seminar, Financial Institution Supervision Department Director General, Dr Akhom Praseuth, said he would like to call on the CIB to work harder to provide financial institutions with accurate credit information as part of efforts to help them to minimise business risks.
He said one of the major challenges was that the number of micro financial institutions has rapidly increased over the past years therefore there was a need for the central bank to supervise them in order to keep the banking system in Laos healthy.
One of the seminar participants, Mr Vithaya Chanthevee, said his financial institute was happy to be a member of the bureau, as his organisation was able to access credit information, a main factor in helping them make investment decisions.
Another seminar participant, Mr Sengphachan Yakanaki, said the CIB was an important data base as it helps businesses to access the accurate credit information, allowing them to make informed decisions on whether to provide a loan to customers.
vientiane times
