ADB, Khan Bank Launch $100M Initiative to Boost Rural Finance and Agriculture in Mongolia

Mongolia’s economy remains heavily reliant on the mining sector, making it vulnerable to global price fluctuations and supply disruptions.

The Asian Development Bank (ADB) and Khan Bank JSC have signed a $100 million loan agreement to expand rural financial inclusion, strengthen agricultural and livestock value chains, and support Mongolia’s long-term goal of economic diversification. The investment aims to empower farmers, herders, and rural micro, small, and medium-sized enterprises (MSMEs)—including women-owned businesses—by improving access to finance and boosting productivity.

Financing to Drive Agricultural Value Addition and Exports

The project will support Khan Bank’s on-lending to:

• Agricultural and livestock processing enterprises

• Herders and crop farmers

• Rural MSMEs, particularly women-owned MSMEs

• Businesses engaged in value-added agricultural production

By helping these enterprises invest in better technology, inputs, and productive capacity, the initiative is expected to increase Mongolia’s export earnings, reduce raw-material dependency, and build competitive, climate-resilient value chains.

Shannon Cowlin, ADB Country Director for Mongolia, highlighted the strategic importance of the partnership:

“This project underscores ADB’s commitment to supporting financial inclusion and agricultural value addition in Mongolia. By partnering with Khan Bank, we will help MSMEs—especially women entrepreneurs and herders—raise productivity, increase income, and support national economic diversification.”

Rural Growth Key to Reducing Mongolia’s Dependence on Mining

Mongolia’s economy remains heavily reliant on the mining sector, making it vulnerable to global price fluctuations and supply disruptions. Rural development offers a pathway to stability and inclusive growth. Yet rural communities face:

• Limited access to finance

• Exposure to dzud (severe winter weather) and drought

• Low adoption of modern technologies

• Barriers to scaling production and entering new markets

The ADB–Khan Bank project aims to close financing gaps that hinder rural development and resilience. Expanded lending will help rural entrepreneurs upgrade equipment, improve supply-chain efficiency, and access new economic opportunities.

Khan Bank’s Nationwide Reach Enables Impact at Scale

With over half a million borrowers, Khan Bank is Mongolia’s largest financial institution and has the widest rural presence of any bank in the country. Its deep community networks position it to deliver financing to underserved populations, including herders who form the backbone of Mongolia’s livestock sector.

Khan Bank CEO Munkhtuya Rentsenbat celebrated the partnership:

“This transformative initiative strengthens financial inclusion and accelerates value addition in Mongolia’s rural economy. It will enable Khan Bank to reach farmers, herders, and rural MSMEs with vital financing—supporting innovation, women entrepreneurs, and sustainable agriculture.”

Building a More Inclusive, Diversified, and Resilient Economy

The ADB–Khan Bank financing aligns with Mongolia’s long-term development priorities, including:

• Promoting private-sector growth

• Reducing reliance on extractives

• Advancing women’s economic empowerment

• Strengthening food security and rural livelihoods

• Supporting climate adaptation within the livestock sector

By channeling resources to rural clients and improving agricultural value chains, the initiative is expected to generate broad socio-economic benefits, including new jobs, improved household incomes, and stronger national resilience.