The National Bank of Cambodia (NBC), the country’s central bank, recently announced various initiatives expected to boost Cambodia’s microfinance industry. One is the Fast and Secure Transfer (FAST) system, which is described as the first system in Cambodia to offer real-time, riel-denominated transfers between banks and “microfinance deposit-taking institutions” (MDIs). Modelled on a similar system in the United Kingdom, FAST will allow customers to complete transactions such as remittances, bill payments, bulk payments, payroll processing and paying taxes. Each transfer is capped at KHR 40 million (approximately USD 1000). The aim of FAST is to increase the use of the riel in Cambodia where USD transactions account for approximately 83 percent of all banking transactions. Mr Hout Leng Tong, president of the Cambodia Microfinance Association and general director of Hattha Kaksekar, reportedly argues that FAST will boost local currency usage as well as making transfers from banks to MDIs easier, safer and faster.
In addition, NBC has increased the minimum capital requirements for MDIs from USD 2.5 million to USD 30 million and for other microfinance institutions (MFIs) from USD 62,500 to USD 1.5 million. Both types of institutions have until 2018 to conform with the new capital requirements. The assets of all regulated Cambodian MFIs total KHR 14.6 billion (approximately USD 3.7 billion), which makes up 18 percent of the total assets NBC oversees.
By Imke Herholdt, Research Associate
About National Bank of Cambodia (NBC)
Established in 1954, the National Bank of Cambodia (NBC) is the country’s central bank. Amongst its functions, the NBC establishes and monitors the country’s monetary policy, supervises and regulates the country’s financial sector and issues the country’s currency.
Sources and Additional Resources
[1] Khmer Times: Central Bank to Put Focus on MFIs
[2] Khmer Times: NBC Set for FAST Step towards Riel Economy
[3] MicroCapital Universe Profile: National Bank of Cambodia (NBC)
Do you know that MicroCapital publishes the MicroCapital Monitor newspaper each month? Find out more at https://www.microcapital.org/products-page/
Similar Posts:
- MICROCAPITAL BRIEF: QR Codes to Facilitate Retail Payments Across Cambodia-Laos Border
- MICROCAPITAL BRIEF: Cambodia Microfinance Association, NBC Launch Project to Increase Financial Literacy, Consumer Protection
- MICROFINANCE EVENT: X Conferencia Centroamericana y del Caribe de Microfinanzas; March 20-22, 2023; Antigua, Guatemala
- MICROCAPITAL BRIEF: B2B Fintech Clowd9 Chooses Netcetera for Payments Security
- MICROCAPITAL BRIEF: Ebanx Acquires Payment Initiator License, Accessing Pix to Simplify E-commerce Purchases in Brazil
