The National Bank of Cambodia (NBC), the central bank of the country, recently revoked the licenses of 11 microfinance institutions (MFIs) for failing to maintain compliance with a “diverse” range of rules. The MFIs, which are classified as “rural credit operators,” reportedly comprise a “negligible” portion of the country’s lending industry. For context, the 45 members of the Cambodia Microfinance Association (CMA) service a total of 1.8 million accounts. However, none of MFIs that lost their licenses are CMA members.
CMA General Secretary Yun Sovanna reportedly said, “In my opinion, it is positive for the market that those who were seriously non-compliant were sanctioned.” An NBC statement was translated as stating that “suspending the licences will set an example for other MFIs to…compete fairly.”
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