Sustainable transformation of the financial sector by strengthening informal financial organizations in Laos


Local project partners
Bank of Lao and Lao Microfinance Association

German project partner
Sparkasse Lörrach-Rheinfelden


01.06.2021 - 31.12.2022

In Laos, a large number of informal to semi-formal community financial organizations exist. Put simply, these institutions operate at the local level like savings banks, i.e. they are supposed to collect deposits locally and extend them as loans to the population and traders.

However, the organizations lack capacity and are not supervised by independent bodies, leading to increased fraud. Overall, the business model of the village banks is not / not very sustainable, which leads to over-indebtedness on the one hand and loss of savings deposits on the other hand.

The aim of the project is to formalize and strengthen selected informal financial organizations so that they can provide sustainable financial services to the target groups. In doing so, not only the informal financial institutions themselves should maintain support, but also, if necessary, associations or other institutions should be enabled to carry out effective monitoring and provide support for the individual institutions. It is planned to extend the project to other countries in the region.


The achievement of the project objective is sought through the following three project focal points:

  • Strengthening the institutional capacity of informal financial institutions.
  • Preparatory measures to formalize the Lao microfinance industry.
  • Create conditions for the involvement of other project partners and project countries in order to exploit synergy effects in the medium term and to reach a broad target population.

Deutsche Sparkassenstiftung für internationale Kooperation e.V.
Simrockstraße 4, 53113 Bonn

Phone: +49 228 9703-0
Fax: +49 228 9703-6613 or -6630

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