IDLO Microfinance Policy and Regulation Survey: Cambodia

Reviewing the regulatory framework for microfinance
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This paper provides an overview of Cambodian microfinance, and traces the evolution of microfinance regulation in the country.

Microfinance evolved from a series of small, isolated projects into a sophisticated segment within the Cambodian financial services sector. Key highlights of the evolution include:

  • National Bank of Cambodia (NBC) set up the Supervision Office of Decentralized Banking System Bureau in 1997;
  • Government created the Rural Development Bank to promote rural finance in 1998;
  • Cambodian Government adopted a two-tier system for supervising microfinance in 1999;
  • Supervision Office was split into MFIs Supervision Office and Project of Support to the Microfinance Sector in 2000;
  • Issuance of new prakas (implementing decrees) marked a move towards commercialization of microfinance and its integration into the formal financial system in 2000;
  • NBC issued and revised regulations that transform NGOs into registered and licensed MFIs in 2000;
  • Cambodian government and the Asian Development Bank worked together to develop a long-term strategy for financial sector development in 1999-2000.

According to reports in 2008, Cambodian regulators are planning the country’s first credit bureau, and hope that such market infrastructure will protect the sector from runaway debt.

About this Publication

By Chou, V., di Castri, S., Hoy, S., Pen, S. & Soung, E.