For Mongolia’s non-bank financial institutions (NBFIs), 2025 was a landmark year. Rapid expansion pushed the sector to record highs while simultaneously amplifying underlying risks. 

🚀 Assets Reach ₮9.1 Trillion

In 2025, total assets managed by Mongolia’s 575 non-bank financial institutions rose by 27.4% year-on-year to ₮9.1 trillion, equivalent to 10.1% of nominal GDP.

• 🙋 For context, in 2016 the sector’s total assets stood at just ₮787.2 billion, equivalent 3.3% of GDP. In other words, over the past 11 years, NBFI assets have expanded 11.6-fold, underscoring the sector’s rapid ascent within Mongolia’s financial system.

🔻 Fewer Clients, More Borrowers

While the total number of registered clients declined by 23.9% to 4.1 million, the number of active borrowers surged by 36.6%, reaching 3.2 million. Over the same period, total outstanding loans grew by 25.5% to ₮7.2 trillion, driving a 50% increase in sector revenue to ₮2.7 trillion. Net profit climbed 35.6% to ₮946.1 billion, translating into a notably strong profit margin of approximately 35%.

• 😵 Non-Performing Loans Jump Sharply: After remaining below 8% consistently since 2020, the non-performing loan (NPL) ratio rose to 8.4% in 2025, marking a sharp 2.3 percentage-point increase year-on-year, a clear signal that risk is rising alongside growth.

💴💵 A More Diversified Revenue Mix

Interest income fell below 90% for the first time, dropping to 88%, while non-interest income rose to 10%, signaling modest revenue diversification. Despite strong loan growth, the average loan per borrower declined 8% to ₮2.3 million, suggesting growth was driven by smaller loans rather than larger borrowers.

🪢 Policy Tightening Takes Effect

Regulatory changes also played a role. In March 2025, the FRC lowered the maximum debt-to-income (DTI) ratio for NBFIs from 70% to 60%, and further tightened it to 55% in 2026. As a result, borrowers with lower incomes or existing debt burdens are increasingly excluded from additional credit, reshaping demand patterns across the sector.

Overall, Mongolia’s non-bank financial sector continues to expand at a remarkable pace, repeatedly setting new records. At the current trajectory, net profit could exceed ₮1 trillion as early as next year. However, regulators appear poised to redirect the sector away from consumer lending toward business and productive credit, tightening oversight as risks rise.