VIENTIANE — It is only an ATM, but it might as well be an alien spacecraft that crash-landed in central Vientiane. People still do not know what to make of the country’s first ATM, despite the fact that it was installed three months ago.
In keeping with Laos’ deserved reputation as one of the friendliest countries on Earth, the machine has a sign outside saying “Welcome to BCEL’s ATM.” BCEL (Banque pour le Commerce Exterieur Lao, the country’s largest state bank) has even built what looks like a weatherproof telephone box to house the ATM. “We want to keep the dust and rain off,” explains BCEL staff member Phetsamone Somsana.
Phetsamone’s job is to issue the country’s first ATM cards to customers — but she is hardly rushed off her feet. So far, fewer than 300 customers have signed up for one; bank staff say that so far there have been 20 to 30 transactions a day. And many of those are by bank staff.
The response to Laos’ latest step into the modern world is lukewarm, to say the least. This is partly because most people have never used one before. Phetsamone says everyone who applies for a card asks how to use it. Some of the reluctance can be put down to fear of the alien object.
“Some people are given their card but then are too scared to try it,” says Phetsamone. “They are not sure if their card will come out.”
There is certainly a need for an ATM — at every state bank in the country. Outside the building where BCEL has its main branch, customers told me that they regularly had to wait more than half an hour to withdraw cash, and up to three hours to cash or receive a check.
“That’s much faster than it used to be,” says Santisouk Thanouvanh, an account holder at BCEL, “and this is the fastest bank in town.”
Things inside are indeed improving. A recent innovation is a formal queuing system in which you take a numbered ticket when you walk in. But when your number comes up, the customer service technique used by most staff remains the same: They wave you vaguely but very cheerfully toward someone else at the other end of the counter.
When someone eventually takes pity on you, you fill in a few forms, which promptly disappear into the hands of another clerk. It is important to keep watching — losing track of where the paperwork is means not knowing who to smile at in the hope of speeding along proceedings. Once your papers have passed through a few different people (who may stamp, sign, copy or simply look at the documents in a bewildered way) your money, check or receipt will appear — unless of course you are asked to return the next day, or the day after that.
First-time visitors to the bank often wonder why there are plastic bags on the counter, but it soon becomes obvious. Even the smallest withdrawal necessitates their use, since the kip (the Laotian currency) is one of the world’s least portable monies. The 1997 Asian crash devastated the kip, which lost 90 percent of its value against the dollar over the following two years.
Since 5,000 kip (0.38 UK pounds) is the largest bank-note denomination, cashing even a small amount of another currency results in the kind of bulging wallet that would denote wealth in most other countries.
Adding to the fun, the 5,000-kip note is in short supply. A kind of cash-apartheid system is usually in place; if 5,000-kip notes are available, only foreigners and important or well-connected Laotians get them.
The other notes are between 2,000 kip and 100 kip. The smaller notes are often distributed as blocks of a thousand notes (bound together with strong plastic tape) — about the size of a house brick and not worth all that much more.
According to a recent International Monetary Fund report, foreign currencies now account for the largest component of the domestic money supply in Laos. It is easy to understand why. The kip may have stabilized over the last two years, but it is still highly inconvenient to carry. You can completely fill a briefcase with the equivalent of 60 British pounds.
Since Laos’ new ATM dispenses cash only in kip, there is a limit to how much you can actually withdraw. A standard card allows four withdrawals of 100,000 kip each a day, while a gold card lets you double that.
“Our high-income customers complain that this is not enough, but they understand that it is because of the notes,” says Phetsamone.
All is not lost, though. The central bank announced recently that it will introduce new 10,000 and 20,000 kip notes in the near future. It could be just what the ATM needs.
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