Movable-asset lending introduced in Laos
Movable-asset lending introduced in Laos
The International Finance Corporation (IFC), a member of the World Bank Group, in collaboration with the Ministry of Finance introduced ‘movable-asset lending' to improve access to finance for Lao micro, small and medium enterprises.
Director General of the State Assets Management Department under the Ministry of Finance, Mr Chanthanom Phithasone, said at the workshop on movable-asset lending in Vientiane yesterday that Lao small and medium enterprises faced difficulty accessing loans.
“Getting a loan is one of the top challenges faced by Lao small and medium enterprises,” he said, adding that introducing movable-asset lending will unlock significant and affordable financing for these businesses.
He said it also marked a milestone in the development of Lao financial infrastructure.
Meanwhile movable-asset lending was introduced to banks, lending institutions, business associations and regulators.
IFC had previously helped China and Vietnam set up centralised online registries for movable assets so that banks can more easily gauge the credit worthiness of borrowers and make quicker lending decisions, thus expanding financing for small and medium enterprises.
IFC's Principal Operation Officer and Lead for F inancial Infrastructure, East Asia & Pacific Advisory Services, Mr Jinchang Lai, said “movable-asset lending can be a profitable way for banks and other lending institutions to tap into the small business market in Laos.”
He said IFC and the Ministry of Finance helped lenders to increase their understanding of the benefits of lending based on movable assets.
“Using the online registries for movable assets will make it easier for lenders to obtain reliable information about their clients and also add incentive for clients to repay,” he said.
IFC has been working with the Lao Ministry of Finance to establish an online registry for secured transactions involving movable assets and provide training to officials. The project is carried out in partnership with the Swiss government and the US Agency for International Development.
vientiane times
