Microfinance group to increase registered funds
Microfinance group to increase registered funds
The Xayoudom Non-Deposit Taking Microfinance Institution plans to increase its registered funds after making good business progress since its establishment.
The institute was established in Vientiane in 2012 with registered funds of 300 million kip.
By last year, Xayoudom had doubled its funds to 600 million kip and plans to increase that to 3 billion kip this year, an institute representative, Mr Lady Xayasane, said last week.
Mr Lady revealed the figure at the annual non-deposit taking microfinance institutes forum held in Vientiane.
Most loans were released forin trading, to the agriculture and livestock sector, and for occupational promotion and education, he said.
The majority of the loans were small scale, ranging from 500,000 kip to 50 million kip while the highest were less than 10 percent of total registered funds, Mr Lady said.
The rate of interest levied was 2.5 percent to 4 percent, while payment depended on the preferences of customers, whether they wanted it calculated daily, weekly, monthly or over another period.
The main aim of the institution is to reduce people's reliance on illegal loan systems and provide them with affordable access to finance.
The group's credit expansion will allow it to focus on gro ups of customers in each village, as well as state offices and schools in order to ease workloads, save time and decrease expenditure.
The institution will focus on participatory credit services and be responsible for its member customers.
Many Non-Deposit Taking Microfinance Institutions (NDTMIs) still face various challenges in their operations and organisational development to meet international standards despite continued growth in the sector.
They need to improve their administration and systems and management equipment and increase their employees' capacity for sustainable growth and healthy competition.
The assets of NDTMIs last year increased from 107.33 billion kip in 2015 to 126.98 billion kip or by about 18.25 percent, the Financial Institution Supervision Department of the Bank of the Lao PDR reported.
Credit offered by NDTMIs rose from 83.65 billion kip in 2015 to 86.88 billion kip last year or 3.85 percent and net profit increased from 8.83 billion kip to 10.91 billion kip or 23.51 percent.
The numbers of NDTMIs increased from 43 to 59, with total funds increasing from 46.63 billion kip to 63.33 billion kip or 35.81 percent.
