The Roaming Agents of Lao PDR

The Roaming Agents of Lao PDR

By David Kleiman, DFS Expert
December 14 , 2017

Above: BCOME pilot in the center meeting at Thakad Village, Beng District

In the body text: Financial Literacy and awareness of XMI and BCOME service to Grade 12 students of Beng District High School

Vientiane, LAO PDR - 

On October 16th 2017, Yong Duangphachanh did not make the 2-hour journey to a banking agent point in the district town to deposit money for her children’s educational fees. Instead, she attended a Xainiyom Micro Finance (XMI) center meeting in her village in northern Lao PDR and was the first in her area to experience the latest evolution in branchless banking.

XMI has partnered with BCEL’s Community Money Express (BCOME) and since February 2017, has been providing BCOME transactions to its customers via their 7 branch offices; including Beng where Yong Duangphachanh has her XMI account.   But what delighted her was that now she did not have to travel to the agent -  now the agent could travel to her.

This pilot initiative is supported by the UNCDF Making Access to Finance More Inclusive for Poor People (MAFIPP) programme jointly operated with the Bank of Lao PDR, with support from the Australian Government and technical assistance from UNCDF MM4P. The programme aims to integrate microfinance institutions (MFIs) in to the digital finance ecosystem in appropriate ways.   As a follow up to MAFIPPs  “Training on Digital Finance and Interventions Models for MFIs”  in and building upon the UNCDF MFI strategy toolkits  to  enter the digital financial service (DFS) arena,  XMI  was  ready to take the next  step.   

To provide convenience and continuous service to its remote customers XMI conducts weekly center meetings in all villages accessible by motorbike.  Meetings only occur in the mornings, and take about one hour typically for clients to make loan repayments, to deposit or withdraw on their savings accounts.  Now, as part of the center meetings, the XMI field staff travels to the community with a laptop, printer and, most importantly, a 3G Pocket Wi-fi router to allow the loan officers to connect to the BCOME platform. There are already plans to replace the equipment with a more portable tablet and a pocket-sized Bluetooth printer.  Although now customers can avail opportunities like BCOME transactions including depositing and remitting funds.  Currently, XMI conducts center meetings in 3 provinces (Oudomxay, Luang Namtha, Bokeo) and 14 districts covering 415 villages. 

And with all that traveling, XMI staff are well known in the communities that they serve, and they look for innovative ways to bring valuable services and raise awareness about them.  As part of their mission, they conduct promotional activities at schools.  Such as the outreach to high school seniors conducted by XMI at Meuang Beng High School where students were introduced to the benefits of savings and educational loans. Although XMI accounts cannot be opened by minors, it is presumed that parents will be able to avail of these services on their behalf. Additionally, XMI explained how BCOME transfers can help students who study away from home and need to receive financial support from their relatives.





XMI continues to make further inroads for financial inclusion and values its relationship with BCOME as it is a positive way to associate with BCEL (the largest bank in Lao PDR with 41% market share in retail savings and 4% in lending). The association makes people more confident in conducting banking and financial services with XMI.

This pilot activity of offering remote transactions has been well received by customers but it is not without its challenges. BCEL is cautious about allowing agents to conduct transactions away from the designated and approved premises.  BCEL understands the importance of trust in agent banking transactions. And they ensure it by having an authorized sign board and customer pricing clearly displayed. XMI and their well-trained staff could offer significant assurance to BCEL. XMI has been authorized by BCEL to conduct only on-line BCOME transactions, so that the BCOME remittance occurs in real time.  The customer either gives cash or the amount is debited from her/his savings passbook – the transaction will be recorded in the XMI monitoring information system only when the credit officer returns to the Service Unit. The XMI savings passbook (containing the client’s picture) can be used for formal client identification in lieu of the common ID card of family book – a procedure mandated by BCEL to fulfill the anti-money laundering obligations applicable to commercial banks.

XMI is hampered by the lack of suitable mobile data connectivity at many communities, which would require offering off-line transactions.  For example, when a customer wants to deposit or remit funds, that transaction would be executed once the officer returns to the branch office where there is a stable internet connection.   BCEL is considering authorizing off-line transactions based on the success of this initial pilot with a roaming BCOME agent.

“A service such as this makes banking more accessible and can also increase business for us,” said Khanthaly Saenvilayvong, Managing Director of XMI. He accompanied the team on this first experiment and is pleased and proud that XMI is the first to bring a real time DFS solution to a remote community in northern Lao PDR. “These DFS services will continue to develop and provide opportunities to offer more and more services -  once people become aware of the service they will try it and then become regular users due to the security and convenience.” 

XMI key figures (as of Q3 2017 unless stated otherwise, source:

Nb clients 34,280 (60% women)
Nb borrowers 9,223 (72% women). Largest Lao MFI by number of borrowers
Loan Outstanding 45.1 billion Kip ~$5.4mn. Agriculture loans 65-70% of portfolio
Portfolio at Risk 30days (PAR30) 2.29%
Total assets 57.0 billion Kip ~$6.9mn
Return on Assets (RoA) 11.9% (2016 annual)
Nb Service Units

7 all acting as BCOME Service Points

Nb & value BCOME transactions 117 with total value 259,457,000LAK ~USD 31,600
(October 2017, at roaming agent and XMI Service Units combined)
For more information, please contact
Aliska Bajracharya
KM Consultant, Lao PDR
Additional Information
Aliska Bajracharya
KM Consultant, Lao PDR