The Bank of the Lao PDR (BOL) has announced that commercial banks and currency exchange providers will be subject to new limits on the sale of foreign currencies.
A new Decision on currency exchange services for commercial banks and exchange booths limits the sale of foreign currency to LAK 15 million per individual, per day.
Individuals must indicate their reason for exchanging foreign currency, as well as provide identification, such as a valid passport, identification card, or family registration book.
Under the new Decision, commercial banks may sell foreign currency to legal entities or domestic and international organizations, while exchange booths and providers will only be able to sell foreign currencies to individuals.
Commercial banks must also give priority to organizations wishing to purchase foreign currency to purchase certain prioritized goods, such as fuel, medicine, or other essential consumer goods that must be imported from abroad.
The Decision states that commercial banks should also allow the purchase of foreign currency for payment of services related to international trade, foreign investment, paying loans in foreign currency, the provision of international aid, payment of dividends to foreign investors and wages to foreign labor, or payment to universities or hospitals in foreign countries.
The Bank of Laos has begun cracking down on illegal exchange traders and currency manipulators in a bid to bring the official exchange rate closer to the market rate.
Rising inflation and a continually depreciating local currency have seen many turn to illegal or online currency exchange operators to take advantage of favorable, unofficial rates.
Authorities in Laos ordered currency exchange businesses to transition into representatives of commercial banks across the country in September last year.