Bank of Laos raises interest rate to 10% amid economic challenges

Image from Laotian Times

VIENTIANE (Laotian Times): The Bank of the Lao PDR (BOL) has announced an increase in its interest rate for short-term loans from 8.5 per cent to 10 per cent per annum.

This decision is in response to both domestic and global economic changes and reflects the bank’s efforts to address ongoing economic challenges.

The announcement was made through a formal notification issued on 12 June.

Approved by BOL Governor Bounleua Sinxayvoravong, the directive instructs the Monetary Policy Department and the Department of Banking Operations to implement the new rate and ensure that information about the change is widely disseminated nationwide.

This new directive supersedes the previous notification which had been in effect since 7 March.

According to BOL’s historical interest rate chart, the rate for loans of less than one week was 7.50 percent per annum as of 13 February, 2023. It was then adjusted to 8.50 percent in early March.

The latest increase to 10 per cent marks a significant step in the central bank’s efforts to address current economic conditions.

The BOL’s decision is expected to influence various sectors, potentially affecting borrowing costs, investment strategies, and overall economic activity in Laos. - Laotian Times