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Emerging Subjects of the New Economy: Tracing Economic Growth in Mongolia


Living on Loans

By ucsawat, on 22 January 2016

This is the second blog post in a series about debt and loans.


Because of its history with debt, Mongolian culture contains sayings on its negative moral implications. The saying mentioned in Rebecca Empson’s blog entry, ‘Өргүй бол баян, өвчингүй бол жаргал’ (‘To be without debt is to be rich, to be without illness is to be happy), alludes to the widespread indebtedness of Mongolians to Qing-era traders in the 18th and 19th centuries. The contemporary Mongolian word for ‘loan’, zeel, also originated from this period and is derived from the Chinese word for ‘loan with interest’ (jiè) (Wheeler 2004: 232). Yet, the definition (and moral associations) of zeel has changed considerably historically. During the Socialist-era, for example, prohibition of individual property made formal indebtedness difficult. Instead, this era saw the proliferation of lending, borrowing and trading between family members, friendship groups and acquaintances, which were also called zeel. Utilizing networks (tanil tal) to acquire goods and services was a commonplace occurrence (Sneath 2012: 459).

The multiple meanings of zeel

Mongolians are once again deeply in debt, but the meaning of the word zeel (‘loan’) has expanded to adapt to the vagaries of this contemporary economy. At its core, a zeel indicates an exchange of money or goods that has a (sometimes indefinitely) delayed reimbursement. Contrary to Western understandings, zeel does not (predominantly) imply an economic transaction between two parties. In fact, similar to the network-building of the Soviet era, Mongolians are simultaneously involved in over a dozen ‘loans’ in diverse forms like money, dairy products, animals, clothing, and building materials to the bank, their neighbours, their friends, their school, the local kindergarten, etc.

Take the example of Degee, a 31-year-old woman with her own bakery business in the town of Halh-Gol in eastern Mongolia (population roughly 1,687).[i] Like most local small-business owners, Degee took out two currency loans—from the government and from a commercial bank—to finance both her daily expenses (хэрэгцээтэй) and profit-oriented endeavours (үлдэцтэй). Currency turnover is low, she says, so she also engages in a plethora of informal zeel in order to keep her business going in an economically beleaguered community. For example, local government workers, despite having stable jobs, are frequently paid late depending on when the government has money. During this period, many of these workers come to her to get a zeel of goods until their money comes in.[ii] Even the local kindergarten does so, by getting bread and food stuffs from her for the children three times a week to be paid back at the end of the month.

Degee account notebook

Degee’s account keeping in an old notebook in her bakery.


In fact, while talking with Degee in her shop, a herder entered her store. The herder gave Degee dried curds (aarts), in return for a zeel of baked goods she had received—i.e. for having taken bread a few weeks before with a delayed payment. Because of the pastoralist cycle, most herders receive cash during spring, when they can sell the first goods (i.e. wool) produced by their herd that year. Thus, the herder gave her dairy products in order to placate Degee until the herder could pay back the full worth of the baked goods. In addition, the herder left more dried curds at Degee’s bakery, for a third-party woman to pick-up at her convenience. This third lady was a trader, and had brought clothing from China and given them to the herder. The curds, left at the bakery, were a (partial) repayment, like an interest, for this zeel of the clothing.

Degee account notebook2

The messiness of records is emblematic of the messiness of loan networks. Here, Degee lists people in various categories like ‘hospital’ and ‘kindergarten’ and the amount they owe next to them. In the middle is ‘захиргаа’, i.e. government administration. See also Empson 2014.


In this way, the bakery functioned as a shadow repository for wealth to the commercial banks. Degee complained about monthly bank loan interest payments, not because she couldn’t pay them, but they kept her customers from having money to use at her store. In the struggling economy, most earned currency was given to commercial banks as loan payments, leaving little leftover for food stuffs. Yet, a business is more forgiving of late payments than a bank, and thus the bakery and its patrons were enmeshed in a web of loans of various goods, services and IOUs. These messy (sometimes multidirectional) economic exchanges, often intermeshed with currency from banks (or pawnshops), are the current manifestation of zeel (‘loan’) networks in Mongolia.

The Morality of Loans

Consequently, in Mongolia, being in debt is a normalcy. Everyone has a loan, said Degee, after I asked if loans were shameful. According to her, even individuals with steady jobs (like government workers) are paid so sparingly that they need to take out a (bank or individual) loan for any ‘larger’ purpose or occurrence—i.e. a car for the family, a television or medical expenses. Thus, with a steady job as collateral, these families frequently pay interest for a few months, establish good credit with the bank, and extend the loan. With this extended bank loan money, they pay off Degee. In this way, the conclusion of a bank loan gets pushed off into the distant, unseen future. Economic necessity thus breeds the continuation and repeated reopening of bank, pawnshop and interpersonal loans.

Amar, a 28-year-old trouser trader on Ulaanbaatar’s biggest outside market, Narantuul, has a story that corroborates Degee’s narrative. Although Amar works freelance, his wife is employed by the state as a policewoman. Due to vagaries in his earnings, Amar’s wife took out a loan with her steady employment as collateral, in order to pay for their daughter’s kindergarten and her return to university. He lamented that bank loans on the basis of employment (цалингийн зээл) were the most difficult to negotiate, because the salary was too low—stable enough to get a loan, but never enough to pay the loan back fully. Thus, government employee families (like his) became dependent on bank loans for their moderate living standard (as a supplement to their salary). Loans are only morally negative when you can’t pay them back, he says, but even then the requirements and social circumstances can be too difficult. Thus, Amar continues, ‘the failure to pay back a loan is 30 percent the person’s fault and 70 percent society’s fault’.


The chaos and competition of Narantuul, Mongolia’s largest informal market, sinks many traders into informal and formal debt.


Consequently, the moral connotation associated with loans and debt is changing. Although older generations might regard a formal loan as a sign of character failing (as a vestige of Socialism), younger generations engage with the concept differently. Informal market traders like Amar are exposed to daily vagaries and irregularities in income. For them, the inability to pay back a loan looks like a failed dream (and not a reflection of their moral character)—an attempt to expand a business that went bust in a faltering economy. Within this narrative, the locus of control lies outside of the individual and is instead dependent on the whims of government, banks and the economy. To others, debt is shameful when it destroys social relationships—reflecting the trust embedded in interpersonal loans. Yet as the economy continues to fluctuate, debt increasingly normalizes as a feature of everyday life, removing much of its stigma.

Trader of household goods Narantuul

A trader of household goods in her container (контейнер) stall on Narantuul. She frequently gives ‘loans’ of goods to neighboring stalls when they run out of product for the day so they can continue business.


The Sociality of Loans

As previously mentioned, loans in Mongolia involve a diverse network of exchange, obligation and transaction between multiple actors, both official and unofficial. Because of the historical prevalence of sharing between kinship groups in Mongolia, anthropologists have referred to these material flows between people as social ‘enactions’—“These sorts of transmissions are so common and expected that they can be seen as materialisations of the social relations themselves, a result of expectations and obligations generated by kinship and friendship connections” (Sneath 2012: 459). Prior to the switch to a market economy, sharing, loaning and borrowing amongst people was common and expressed in terms of duty, favours and obligations between friends and family (459). These material exchanges still exist, yet are increasingly monetized in the interest of profit.

Take the following example of exchange amongst a group of friends: Person A uses a BMW that is owned by their parents. Person B, their friend, has an old Range Rover and wishes to sell it. Unable to find a buyer, Person B brings his car to a pawn shop and pawns it. They both have a friend, Person C, who has a new Range Rover, but now dislikes its fuel consumption. Person B tells Person A about Person C’s problem, who then passes the BMW through Person B to Person C. Person B thus exchanges the BMW to Person C for the new Range Rover. Person B then takes the new Range Rover and sells it to Person D in exchange for money and a Japanese car. All the while, Person B continually pays Person A a small sum of money as a form of interest until they can fully pay off their ‘loan’ for the BMW (which is actually legally owed to Person A’s parents).

Similar to Degee’s small business, kinship and friendship networks increasingly become zeel networks financed through a diverse system of bank loans, barter, pawnshops and trade. Although these exchanges between friends are still frequently couched in terms of ‘favours’ and ‘help’ (тусламж), these favours more and more come with a price. As with this example regarding the BMW, loans of goods or money between friends now commonly involve interest (to make ‘it worth it’, as one informant said), which was unheard of during the Soviet era. Additionally, in the absence of capital to meet their needs, individuals can lease, loan, sell or borrow their family member’s property or take a bank loan out using a family member’s collateral (давхар зээл). In this way, Person A could sell or loan out their parent’s car without repercussion. Thus, in light of the struggling economy, familial and friendship networks take on a new dimension as means for increased capital access (these networks also act as collateral in pawnshop loans—see previous blogpost).

The Monetisation of Trust

The zeel networks were historically based on trust within a small community. For example, Jagaa, a 34-year-old jacket trader on the informal market in Choibalsan, frequently lends and borrows goods and money from the girls on her trading floor. Because of their close working proximity to one another, which results in intertwined friendship networks, the girls will frequently give each other money when in need—i.e. when one of them can’t pay back their bank loan payment that month. Jagaa says that she ‘trusts people’ (хүнд итгэдэг) and thus will unreservedly give out loans of products and money to acquaintances sent by friends. This form of trust in zeel exchange is not uncommon on Mongolia’s contemporary markets—Zola, a 21-year-old, whose family works on Narantuul, explained that once a customer became a regular, ‘trusted customer’ (найдвартай харалцагч), her family will freely send goods to that customer on request to be paid back at leisure. In this way, zeel networks on informal markets, within friends and family have historically been based on trust within a community.

Loaning money at Narantuul

Women (and men) who work in the same section of a market frequently ‘loan’ each other money or goods or will sell goods for each other when one is absent/ill. In this way, they build trust networks amongst each other. The sign reads: “All bank cards accepted here”.


However, as the language of loans shifts from favour to self-interest, so too does trust shift from individual to institution. In the past, formal zeel transactions between people were settled through verbal contracts (амаар хийсэн аман гэрээ), based on communal trust and expectation of obligation fulfilment. Yet, as Jagaa mentioned in our interview, most Mongolians now have an example of the failure of that trust—of being ‘used’ through a zeel and then abandoned (ашиглуулаад л өнгөрдөг). Stories abound of friends being jilted through the lack of a business contract; individuals changing their phone numbers after getting a personal loan; or giving a zeel to a classmate who just disappeared. Promises and informal contracts, unfortunately, do not stand up well in the court of law. Verbal contracts are thus increasingly seen as risky (эрсдэлтэй). In this way, the legal-backing of bank loans gradually become more desirable where interpersonal loans might have been more popular in the past.

The current relationship between trust and commerce institutions (as a buffer for risk) was explained to me as follows: In zeel exchange between close relatives/friends, no interest is taken, but small ‘gifts’ of money are given. In zeel exchange between friends and acquaintances, an interest is taken. In zeel exchanges between strangers, a notarized contract is required. Thus, as the social distance widens, so too does the reliance on institutionalized methods of commerce (see also previous blogpost).

Jagaa and goods

Jagaa hidden among all her coats at the market.


Surviving the Economic ‘Hangover’

Between 2011 and 2015, the GDP growth of the Mongolian economy dropped from 12 to 3 percent. This precipitous decline was recently described by Enkhbold, head of both Parliament and the Democratic Party, as the economic ‘hangover’ after the party (шартдаг үйл явц).[iii] In a beleaguered economy, zeel, in all their various instantiations, become instrumental to everyday economic survival. Far from the individual, strictly institutional monetary exchange envisioned by Western economic policies and bank initiatives, the definition of and implementation of zeel in Mongolia encompasses a wide range of barter, borrowing, exchanging, transferring, giving, pawning, and payment between friends, family, acquaintances, banks, pawnshops and group networks. The boundaries between official, unofficial, trust, obligation, self-interest and profit blur, as neither old forms of trust networks, nor new pecuniary institutions are without risk.

Consequently, whereas others might live from hand to mouth, Mongolians increasingly live from ‘loan to loan’ (зээлээс зээлийн хооронд явдаг), as their social needs are met through the continual opening, fulfilment or extension of diverse forms of zeel to one another. Within this framework, the goal of a loan is not necessarily eventual completion, nor is debt necessarily seen as a sign of character failing. Moreover, as one sum herder stated, getting a loan was like going with the times (Орчин үеээ дагаж өөрчлөгдөж байгаа учраас зээл ч гэсэн авж байна). Loans represent one’s engagement in the negotiation of personal needs through societal relationships, as well as the accrual of money through market turnover and continual payment. Consequently, as the fluctuations of the market economy impact everyday decisions, even the historical practice of kinship and friendship obligation become defined through the language of market, exchange, profit and interest.



Empson, Rebecca 2014 An Economy of Temporary Possession (available on-line: http://www.lse.ac.uk/newsAndMedia/videoAndAudio/channels/publicLecturesAndEvents/player.aspx?id=2461)

Sneath, David 2012 The ‘age of the market’ and the regime of debt: the role of credit in the transformation of pastoral Mongolia, Social Anthropology/Anthropologie Sociale (2012) 20, 4 458–473.

Wheeler, Alan 2004 Moralities of the Mongolian ‘Market’: A Genealogy of Trade Relations and the Zah Zeel, Inner Asia (2004) 6: 215-38


[i] http://khalkhgol.dd.gov.mn/мастер-төлөвлөгөө

[ii] In her 2014 public lecture “An Economy of Temporary Possession”, Empson notes that locals do not refer to these exchanges as ‘loans’, but occasionally as ‘milk money’. However, in Empson’s example, locals were engaging in barter where no money was exchanged. Degee, in contrast, always used money as a base and never accepted full payment in goods. Thus, she continued to use the language of ‘loan’, thus indicating her conceptual linkage between currency and loan giving. The recording is available at: http://www.lse.ac.uk/newsAndMedia/videoAndAudio/channels/publicLecturesAndEvents/player.aspx?id=2461

[iii] http://dnn.mn/з-энхболд-уих-ипотекийн-найман-хувийн-зээлийн-асуудлыг-энэ-сардаа-шийдвэрлэнэ/

Chains of Debt: Accessing ‘Ready Cash’ through ‘Material Loans’

By ucsaar0, on 13 January 2016

This is the first in a series of blog posts about debt and loans.

Pawnshops, banks, and non-bank financial service centres (NBFS) are prevalent all over Mongolia. You can hardly turn a corner in Ulaanbaatar without seeing signs advertising low-interest loans. Paradoxically, however, the idea that people are easily able to access cash obscures the fact that everyone, it seems, is in debt. Indeed, most people’s pockets are predominantly filled with the anxious pressure of how to make their next repayment and defaulting on loans is giving rise to a growing market for repossessed goods.[1]

While private debt is a shadow that looms over individuals, public debt is equally ubiquitous. In many ways, the debt of individuals and that of the nation mirrors each other. From 2008-2012, people took out large loans banking on future growth (cf. Batsuuri 2015: 12). This growth has not transpired, leaving people negotiating with their debtors to restructure agreements, or taking out smaller loans in order to survive.

The economist Batsuuri Haltar has commented: ‘The combination of high public debt and rapid private-debt growth means that an imminent economic crisis in Mongolia is now fast approaching’ (Batsuuri 2015: 10). People speculate that over 80% of retirees are in debt, their pensions being a major source of collateral against which to take out loans for family members. Borrowing from those who have taken out loans, especially those with salaries, is prolific across all sectors, leading to multiple chains of indebtedness.

And while Mongolian tradition points to the value of being debt-free: see, for example, the proverb, ‘being rich is being debt-free, being happy is being free of illness’ (Өргүй бол баян, өвчингүй бол жаргал) (Batsuuri 2015:5), debt is now so common that it has itself been re-conceptualised, something illustrated in the new proverb: ‘Money owed to lenders is not debt, it’s just a loan. Debt is when we fail to pay the loan’ (Өр, зээл гэдэг хоёр өөр ойлголт. xүнээс мөнгө зээлээр аваад төлөх болоогүй үед энэ бол өр биш, зээл юм. Xарин өр гэдэг бол чи авсан зээлээ төлж чадахгүй болсон үед л бий болдог эд) (Batsuuri 2015:5).

Ankara Street

Ankara Street is home to at least seven different lombards.[3] The people who work here are mainly women. They are reserved and quiet, brushing off questions by pointing to signs pasted on walls. Their shops are often nestled in the same room as hairdressers, beauty salons, restaurants and manicurists. The relationship between hairdressers and pawnshops was explained to me as being especially fruitful – as people visit the hairdressers every month or so, they are reminded to make a payment on their loan. The pawnbroker sits behind a booth that cuts it off from the rest of the room. Several cameras point at the client as they peer in to communicate, to fill out the contract, or to hand over their treasured items in order to receive cash. Lombard loans are easier to obtain than bank and NBFI loans, involving less paperwork and collateral, but their interest rates are the highest of all.

Image 1. Salon, Pharmacy, Pawnshop Resized

Image 1.  Salon, Pharmacy, Pawnshop.


While lombards offer cash without many questions or forms, they hold on to your collateral, off-set against the money given, and ask for a long list of telephone numbers of you and your family members.  Pawnshop loans are not simply granted to individuals on a whim. They are a way of holding in place a relationship to a whole group of people who are all accountable for the repayment. The telephone list you hand over implicates people in a chain of debt, something mirrored by the lombard owners themselves who take out different kinds of loans to establish their businesses and get the initial cash. Lombards, as one informant summarised, are ‘a way to get ready cash quickly’, but they leave a chain of people in their wake who become entangled in the circulation of cash for goods.

The shops along Ankara Street grant loans against mobile telephones, laptops, money and jewellery. Interest rates and repayment policies differ slightly between the shops (between 7% to 9%, based on autumn 2015), as does the amount of money they lend. Some provide different services, such as selling mobile phone units and in others, if people take out back-to-back contracts, the interest rates decrease. Some of these lombards specialise in high-interest, quick-turnaround loans which have to be paid back in two weeks. Others, like Khiimor’ lombard offer contracts for up to 1 to 2 years.

Image 2. Khiimor' Lombard resized

Image 2. Khiimor’ Lombard


Khiimor’ Lombard Sign of Services.

Image 3.  Khiimor’ Lombard’s Sign of Services and Interest Rates.


Men and women from 20-50 years old come here when they urgently need cash to pay bank loans, school fees, mortgages, rent or other deposits.  Or, as several people put it to me, ‘young people often put in their computer to get money for a night of drinking and partying’. Reasons for accessing cash differ, but several explained that they preferred to be in debt to the lombard rather than to friends and family. Perhaps the lombard does provide a kind of distance and anonymity, without having to divulge to friends or family why one needs the money.

I assumed that work here could involve threatening interactions, but many of the women I spoke to explained that it was not risky in terms of their own safety. All the lombards have CCTV cameras for protection, and often hang a sheet or cloth over the safe in the back that contains the collateral, while larger items are stored off-site. The risk was based on whom they decided to issue loans to. They needed to be vigilant, one woman explained, assessing correctly who is capable of repaying their loan. CCTV cameras point in multiple directions, at both the hands of the broker and the client. Gathering regular repayments correctly is how the broker maintains her job.

Most lombards offer loans for up to one month for 8%’, the woman who worked at Khiimor’ Lombard explained. She evaluates the item to be pawned, issues a contract and receives monthly payments. Lombard workers can also be somewhat selective in who they decide to issue a loan to, as one woman explained:

‘…if I don’t like the people, I won’t take their items and issue a loan. Sometimes drunk people are just sneaking around asking for money for prostitutes and drink and crime and they just bring their bad smells into here’.

Unlike European pawnshops, repossessed items are not on display for sale in the shop. They are taken by the owner and sold directly onto middle-men who sell them elsewhere. ‘If people are not able to repay their loans’ the broker at Kiimori’ Lombard explained, ‘the owner sells the items to the ‘chanjuud’; the owner has a relationship with these people’. This fact, is one of the only signs that points to the idea of the tarnished, or polluted, nature of such goods (cf. Højer 2012).

Pawnshop and mobile phone units for sale.

Image 4.  Pawnshop and mobile phone units for sale.


Observing people repaying their loans, I was struck by the stern silence of their exchanges. When I mentioned to friends that I was working on the way people access cash, some lamented that the only people doing well in the current economy must be the lombard owners. It seems to me, however, that small lombards, such as those on Ankara Street, are only just ticking over as the chains of debt that make them possible require complex payments that bind people to each other in precarious ways. It is maybe because of this very precariousness – both economic and social – that the exchanges I witnessed were so formal.

Stopping and Non-stop loans

Moving out of the city centre, we find lombards specialising in the exchange of cars, garages, apartments, parking lots, and even plots of land for cash. As one taxi driver lamented, ‘they take anything’. In the 13th micro district, I focused my research at a large car lombard. Physically, this consists of two sites – a large open parking lot with a temporary portakabin office, and a formal office where people come to make their payments.

In the parking lot Ganbaatar sits behind a desk. At his side is a small safe containing car keys and behind him hangs a large oil painting of a car, onto which people have placed some bank notes. People assess the value of cars with different clients outside while one woman manages the gate.

Image 5. Car Pawning resized

Image 5.  Car pawning.


Drive your car while getting a loan!!!

Image 6.  Drive your car while getting a loan!!!


This lombard is a conglomerate, part of the ‘Bichil Globus Group’, which includes a bank where they get their money, and where all the interest rates and loans are decided. The group was established 6 years ago and is said to exist in many of the Provincial capitals of Mongolia.[4] It turns on a distinction between ‘stopping loans’ (colloquial. zogsool zeel, official. avtomashinaa il ba dylaan zogsoold bairshuulakh bolomjtoi) and ‘non-stop loans’ (colloquial. zogsoolgui zeel, official. avtomashinaa unaad yavakh bolomjtoi), between leaving your car in the pawn pound and taking out a loan, or taking out a loan and driving your car at the same time. Loans here are issued for six months at a time, as any longer than this is considered too risky.

Image 7. Painting of car with money resized

Image 7.  Painting of car with money.


Sitting in the portakabin, a man comes in to request a one-day loan in order to buy a ticket to Korea. He hasn’t received his salary for a few months and needs the cash today. Ganbaatar takes his car keys and ID and places them in the safe. He charges 22 thousand tögrög for the contract, which they both sign, and collects a list of telephone numbers and addresses. The value of the car and the loan amount has been decided upon outside. As the man leaves Ganbaatar explains:

 ‘We look at the car’s market price to evaluate the worth and determine the loan. We issue contracts and call people and bother them for their payments. We also take lots of relative’s details and get an address. Sometimes, the police have to collect the money. Most of the time we just sell the car if they don’t answer their telephones, or can’t repay the loan. Approximately 2 out of 10 people are unable to pay back their loans. In these cases we sell the car to make space for new ones. The most important thing is to make the right evaluation of the car in the first place. This way, we don’t loose money. 100 million tögrög is the most that we issue’.

Some leave their cars in the pound for just one day, others for a week, or even months, depending on how long it takes to repay the loan. Ganbaatar exclaimed further,

It is mostly middle-aged people who come, and they are usually men. They take out loans for different kinds of reasons. If you have a car registered in Ulaanbaatar you can access different services  – so countryside people take out a non-stop loan to get cash to have their car registered here while driving it as a taxi in the city.’

Car pound.

Image 8.  Car pound.


At the offices of the Bichil Globus Group a poster greets you proclaiming: ‘We are your Financial Wing’ (tan’i sanhüügiin jigüür) while four men in suits sit at separate desks with files and computers. One man, fiddling with a stapler while speaking on the phone, proclaims softly: ‘I’m ringing you to let you know that today your loan is due. You need to make the next payment. Today you owe us 432 hundred tögrög. If you come in today we can process it.’

Observing this room a strange juxtaposition emerges between the stillness of office and the movement it grants outside. Contacting people all day by phone while watching spread sheets on their computers, the company’s strap line in the parking lot outside reads: ‘Drive your car while getting a loan! (mashinaa unaad zeelee av)’

A youngish man named Bold comes in to pay off 120 thousand tögrög. He goes to the till manned by a woman, makes his payment and is handed an invoice. Again the whole transaction is carried out in silence and with minimal interaction and I am not sure if this is due to a sense of shame that pervades these activities, or simply because it has become so mundane for both client and broker that there is no need for any niceties.


Image 9.  Bold.


Bold is 22 years old and owns a Toyota IST. He recently graduated from the National University of Mongolia where he trained as a software engineer. He placed his car in the lombard five months ago and took out a 6 month loan for 1 million tögrög. He pays 120 thousand tögrög twice a month (i.e. 240 thousand tögrög each month). He needed the money, he explains for his graduation ceremony, for the clothes, and so on. His father gave him the car four years ago, imagining that he could make some money as a taxi driver while he was studying.

 ‘All students with cars take out loans against them’, he explains, ‘it’s a good way to get money, and my parents agreed to it. Every Mongolian has placed some of their things in a lombard to get cash. I’ve placed all kinds of things; a two week loan for my phone, a one month loan for a gold ring. The value is different according to the item. A car gets you 1 million tögrög.’ Now I work and am able to pay back the loan’.

As it turns out, his older brother, with whom he lives, gives him most of the money to pay back the loan. Again, we see that there are no singular transactions. These kind of exchanges are always part of wider chains and obligations that reach back, implicating many different people in networks of debt.

Image 10. Vietnamese garage resized

Image 10.  Vietnamese garage.


In the 16th micro district, up two flights of stairs, nestled among the many Vietnamese garages sits Nomontsetseg in Soronsel Lombard. Her desk is placed behind a high counter above which strip lighting flickers painfully in the ceiling. A few potted plants sit on the internal window sill which looks out onto a brick wall. Nomon has worked here for two years, carrying out all the paperwork for the yard outside.

People call and make an appointment to have their car valued. They come in to sign the contract and then the money is issued, either as cash or as an account transfer. Payments are made monthly and clients are contacted via telephone or SMS messages’, she explains.

In her work, there is a kind of stillness and silence, not present in the hustle and bustle at banks, or at other institutions. This stillness masks the movement that the loans themselves engender, allowing for different projects to be born and put into action.

Behind the simple transaction of a personal item for cash, a complex network of relations is also triggered that ties people together in webs of debt, facilitating new endeavours while prohibiting others. In this domino of exchanges one thing is constant – the loan that is taken out can never be paid back without recourse to yet further loans, allowing for freedom, or an opening, in one sense, while simultaneously initiating future constraints elsewhere.

Image 11 a Immaterial Loan resized

Image 11 b Mobile phone number loan resized

Images 11a & 11b. Immaterial loans & mobile phone number loans.

All photos © Rebecca Empson



Højer, L. 2012 The spirit of business: pawnshops in Ulaanbaatar, Social Anthropology, 20: 34–49.

Batsuuri, Haltar 2015 Original Sin: Is Mongolia Facing an External Debt Crisis? The Northeast Asian Economic Review, Vol. 3, No. 2, October 2015 pp3-15

Rawski, E 1998 The Last Emperors. A Social History of Qing Imperial Institutions, University of California Press: Berkeley, Los Angeles, London

Sneath, David 2012 The ‘age of the market’ and the regime of debt: the role of credit in the transformation of pastoral Mongolia, Social Anthropology/Anthropologie Sociale (2012) 20, 4 458–473.


[1] The rate of nonperforming loans has risen to 7.3% in 2015. See National Statistics Office of Mongolia. http://www.nso.mn/index.php

[2] Lombard is a term that comes from a type of banking that originated in the middle-ages in the northern Italian region of Lombardy, and probably came to Mongolia during the Soviet period when lombards were also common. The prevalence of pawnshops was also common during the Qing period. By the late 18th Cent, Rawski notes that pawnshops and other revenue-baring assets had replaced grants of livestock and estates as dowry for Manchu princesses who married Outer Mongolian Princes (1998: 148-149). They were also common during the 1990s, where ‘Pawning valuables became a common strategy for people thrust suddenly into the margins of poverty. The use of the lombard tended to become cyclical; people would surrender items as security for a loan, later when they found the money they would pay off the debt and interest and reclaim their property, only to find that they were forced to pawn valuables again when their money ran out’ (Sneath 2012:460).

[3] There is a distinction between ‘material loans’ (bar’tsaat zeel) and ‘immaterial loans’ (bar’tsaagui zeel), which may include mobile phone numbers (see Images 11a & 11b).

[4] The Bichil Globus Group has a total of 22 branches – 11 in UB and 11 in the Provincial Capitals (cf. their website).