#National Bank #Cambodia #Phnom Penh #Cambodia Microfinance #UN

Cambodia's Innovative Microfinance Initiative

In a significant move to enhance consumer protection and lending practices in the microfinance sector, the Cambodia Microfinance Association (CMA) is partnering with the National Bank of Cambodia (NBC) and the United Nations (UN). This collaboration aims to address critical issues such as over-indebtedness, land-related financial risks, and overall consumer safeguards. Following extensive consultations initiated in 2024, the initiative is now actively engaging over a hundred stakeholders from government entities, civil society, financial institutions, and development partners to ensure sustainable lending practices.

Dith Nita, the President of CMA, emphasized the association's dedication to working alongside both national and international partners to protect vulnerable populations while advocating for microfinance as a key tool for economic empowerment. “CMA is committed to ensuring that microfinance continues to serve those in need. We are acutely aware of the challenges borrowers face and are actively working to enhance lending practices and bolster consumer protections. Our initiatives are designed to empower borrowers to make informed decisions while safeguarding their rights,” Dith Nita stated.

One of the primary focuses is the establishment of stricter lending standards. In their partnership with the NBC and UN, CMA supports reforms aimed at determining loan eligibility based not merely on guarantees but on borrowers’ repayment capacity. A crucial measure introduced is the prohibition of using Indigenous Community Land Titles (ICLT) as collateral, thereby protecting vulnerable communities from the risk of losing their land.

In addition to these reforms, CMA endorses the expansion of the Financial Consumer Services Center of the Association of Banks in Cambodia (ABC), which provides borrowers access to dispute resolution services and enhanced protections. The CMA is also advancing financial education programs, particularly targeting women and rural communities through projects like the Safe Community Finance Project. These educational initiatives are designed to help borrowers make informed financial decisions and reduce the risk of over-indebtedness.

“Together with our partners, we are striving to build an inclusive financial sector that offers significant opportunities to the most vulnerable populations in Cambodia. Our aim is to equip borrowers with the necessary tools to thrive financially while safeguarding them from financial risks,” Dith Nita added.

These efforts align closely with the United Nations Sustainable Development Goals (SDGs), focusing specifically on poverty reduction, gender equality, and financial inclusion, thereby ensuring that Cambodia's microfinance sector continues to serve as a powerful driver of economic growth and opportunities.

As the consultations progress, CMA invites all stakeholders—including investors, policymakers, regulators, civil society, financial institutions, and development partners—to join forces in shaping the future of microfinance in Cambodia. Through collective action, vulnerable populations can be protected, and microfinance can continue to empower and provide economic opportunities for all Cambodians.

About CMA

The Cambodia Microfinance Association (CMA) is a professional organization dedicated to promoting responsible and sustainable microfinance practices in Cambodia. By collaborating with financial institutions and stakeholders, CMA strives to uphold the rights of borrowers and foster an inclusive financial sector that benefits communities across the country.

For more information, contact:
Name: Tongngy Kaing
Email: [email protected]
Phone Number: +855 95 262 111