Banking - Laos

Laos

In 2024, the projected Net Interest Income in the Banking market of Laos is set to reach US$9.15bn.
Traditional Banks are expected to dominate this market segment with a projected market volume of US$9.12bn in the same year.
Looking ahead, the Net Interest Income is anticipated to exhibit an annual growth rate (CAGR 2024-2029) of 4.97%, resulting in a market volume of US$11.66bn by 2029.
When compared globally, it is noteworthy that China is expected to generate the highest Net Interest Income, amounting to US$4,332.0bn in 2024.
Laos' banking market is experiencing a surge in digital banking services, driven by the increasing adoption of smartphones and internet connectivity.

Key regions: United States, China, Japan, Brazil, United Kingdom

Definition:

The Banking market refers to the financial services sector providing financial products and services to individuals and businesses. Retail banking focuses on offering financial services to individual consumers, such as personal loans, savings and checking accounts, credit cards, and mortgages. Commercial banking, on the other hand, provides financial services to small and large businesses, including loans, lines of credit, and other financial products designed specifically for businesses.

Structure:

The market consists of two segments:
- The Traditional Banking market refers to the financial services sector that provides a range of financial products and services to individuals and businesses through store-based branches and other traditional channels.
- The Digital Banking market refers to the emerging market for digital-only banks that offer financial services through online and mobile platforms.

The market data comprises Net Interest Income, Bank Account Penetration rate, the value of Deposits, the number of depositors, the value of Loans, the number of borrowers, Credit Card Interest Income, the number of ATMs as well as the number of Bank Branches.

Additional information:

The Banking market is highly competitive and characterized by the presence of large global players as well as regional and local banks. Banks are continually seeking ways to improve their offerings and remain competitive by leveraging technology and offering innovative financial products and services. Additionally, changes in regulations and the growing trend toward digitalization are shaping the Retail & Commercial banking market, creating opportunities for new entrants, and forcing existing players to adapt.
Key players in this market are companies such as the Industrial and Commercial Bank of China Ltd., JPMorgan Chase & Co., and HSBC Holdings.

Use the info button next to the boxes for more information on the data displayed.

Market

Region

Region comparison

Currency

Analyst Opinion

The Banking market in Laos has been witnessing significant growth and development in recent years.

Customer preferences: Customers in Laos are increasingly leaning towards digital banking solutions, driven by convenience and accessibility. The younger population, in particular, is more inclined towards online and mobile banking services, leading to a surge in digital transactions. This shift in customer preferences is in line with global trends towards digitalization in the banking sector.

Trends in the market: One of the notable trends in the banking market in Laos is the increasing focus on expanding financial inclusion. With a large unbanked population in rural areas, banks are striving to reach out to these underserved segments through innovative products and services. Moreover, there is a growing trend of banks offering specialized financial products tailored to the needs of specific customer segments, such as SMEs and agricultural businesses.

Local special circumstances: Laos, being a landlocked country with a predominantly rural population, presents unique challenges and opportunities for the banking sector. The infrastructure development in the country is opening up new markets and creating demand for banking services in previously underserved regions. Additionally, the government's initiatives to promote digital infrastructure and financial literacy are shaping the banking landscape in Laos.

Underlying macroeconomic factors: The stable economic growth and increasing foreign investments in Laos are contributing to the expansion of the banking sector. As the economy continues to grow, there is a rising demand for banking services to support the burgeoning business activities in the country. Moreover, the government's efforts to improve regulatory frameworks and promote a conducive business environment are attracting more players into the banking market, fostering competition and innovation.

Methodology

Data coverage:

Data encompasses B2B and B2C enterprises. Figures are based on Net Interest Income, Bank Account Penetration rate, the value of Deposits, the number of depositors, the value of Loans, the number of borrowers, Credit Card Interest Income, the number of ATMs as well as the number of Bank Branches.

Modeling approach / Market size:

Market sizes are determined by a combined Top-Down and Bottom-Up approach, based on a specific rationale for each market segment. As a basis for evaluating markets, we use data provided by the IMF, World Bank and the annual reports of the top 1000 Banks by asset size. Next we use relevant key market indicators and data from country-specific associations such as GDP, deposit interest rates, lending interest rates or bank account penetration rates. This data helps us to estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the particular market. For example, the S-curve function and exponential trend smoothing are well suited to forecast financial services for digital as well as traditional products and services.

Additional Notes:

The market is updated twice per year in case market dynamics change.