Savings and credit cooperatives

Since about 2000, Mongolia's economic and financial markets have become more connected with the those of other countries; and the interest of foreign investors has increased significantly. Accordingly, it has become increasingly necessary to provide integrated management of financial regulation, and establish a unified supervisory system.

Savings and credit cooperative(SCC) is a legal entity established by several persons on a voluntary basis - within a democratic collective, with joint management and control - to operate on the basis of common property, in order to meet their economic, social and cultural needs. Savings and credit cooperatives(SCCs) are not-for-profit organizations, licensed by the Financial Regulatory Commission (FRC).

A draft of the law on SCCs was developed to:

  • promote market competition and access to SCCs,
  • increase product range,
  • improve coordination, and
  • create a legal environment.

Amendments were made to the criteria for prudential ratios of SCCs and approved by the Commission’s Resolution No. 246 of 2018 (by Order No. 1,022 of December 23, 2020).

As many as 285 SCCs that were registered with the General Authority of State Registration (but had not applied previously to the Commission) applied for licenses; but were refused due to non-compliance (or their licenses were revoked).

Of all 249 listed SCCs, 148 were in Ulaanbaatar, and 101 are in rural areas.

Total assets: Net worth reached MNT256.0 billion.


Total savings:

  • Term savings accounted for 98.3%,                                         
  • Nonterm savings accounted for 1.7%.


  • Interest to SCCs reached MNT50.5 billion.
  • The largest portion of total interest income (96.6%) was loan interest.
  • Interest income from banks and financial institutions accounted for 3.2%, and increased interest income from loans accounted for 0.5%
  • Income from financial leasing was MNT17.0 million 


  • Interest expenses of SCCs reached MNT29.3 billion.
  • Deposit interest rate was the highest (98.4%) of total interest expenses.
  • Interest paid to banks and financial institutions, which accounted for 1.5% of interest expenses, increased by 78.8% compared to 2019 - to MNT443.1 million.

Interest expenses on financial leasing was not accounted in 2020.

SCCs assess the potential risks of their operations in accordance with the following four key indicators (PEARLS) methodology Herein:

1. Asset quality and protection;

2. Effective financial structure;

3. Return and cost share;

4. Liquidity


To strengthen the risk-based supervision system, risk assessments were conducted on 120 SCCs in the last 12 quarters (the last three years), and a risk assessment was conducted on the implementation of the criteria for prudence. A total of 353 (including some replicates) reports and 27 notifications were submitted to SCCs.


To improve the strategic policies, laws, guidelines, and procedures for the development and microfinance markets, to conduct research and analysis related to the activities of the SCCs, to set standards, increase access to financial services such as licensing and renewal implement the following functions:

In the field of registration and permission of SCCs:

  • To review the documents and materials related to the licensing, extension, revocation, and registration of the SCC, to make recommendations, to prepare and resolve the prospectus;
  • Automate licensing and registration activities, create conditions for remote email applications and requests, and create an efficient e-service system;
  • If necessary, to obtain professional opinions and explanations from relevant authorities on specific issues

In the field of policy, regulation and development of SCCs:

  • To improve the regulation of SCCs and microfinance markets in accordance with the specifics of the country in accordance with international standards, to develop and approve rules, regulations;
  • To organize training and seminars in cooperation with other departments in the field of SCCs, and to cooperate with relevant organizations;
  • Promote the microfinance market and new products, services to the public, improve the financial education of market participants, and cooperate with other relevant organizations