Microfinance institutions (MFIs) have been expanding their financial services to include the use of mobile phones, a move aimed at boosting services for people in rural areas who find it difficult or expensive to travel to offices in towns or villages.
MFI representatives told the National Summit of Microfinance Development in Phnom Penh yesterday that mobile banking will increase the number of financial transactions clients can make. The service also simplifies the process, is faster, saves time and frees residents of rural areas from having to go to offices in towns and cities to make transactions.
Kea Boran, the CEO of AMK, an MFI, said many institutions are expanding the services they offer via mobile phones. “If we talk about people who have bank accounts, there are small, but if we talk about people who have mobile phones, the numbers are far more than bank account holders,” Mr. Boran said. “Mobile services will encourage more people to use banks and MFIs,” he said.
So Phornary, the deputy CEO of Acleda Bank, said investing in mobile banking benefits both operators and customers. “Customers can use mobile banking to pay for transactions including electricity, water bills and money transfers,” she said. Mobile banking will also benefit Cambodia as the ASEAN Economic Community integration started early this year, Ms. Phornary said.
“Foreign investors, before they come to this country, will try to get an understanding on whether Cambodia still uses traditional payments or modern ones, which is a factor that attracts foreign investors,” she said.
National Bank of Cambodia governor Chea Chanto said: “The NBC has to prepare a policy or strategy of promoting financial inclusion, which facilitates and encourages people to have the capacity to access and receive financial services from licensed institutions and to ensure their advantage is fully protected in transparency.”
However, mobile banking in Cambodia is in the early stages and the service needs a huge investment budget and human resources, while people’s understanding of electronic finance is still limited, he said.
Ouk Sarat, the director of the National Bank of Cambodia’s Payment System Department, said the NBC has been working to prepare a legal framework to ensure fair play, manage risks and to ensure integrity of service.
“What is important is to control cases of money laundering when this mobile banking service surges in the future,” Mr. Sarat said.
Hout Ieng Tong, the CEO of Hattha Kaksekar Limited, one of the largest MFIs in Cambodia, told Khmer Times yesterday that his institution welcomes mobile banking, which he said will help modernize Cambodia’s financial sector. However, he added that there are obstacles in processing this service, although Hattha Kaksekar Limited introduced mobile banking in 2014 and now has about 40,000 clients.
“Although we see the increasing use of mobile phones, mobile banking will not be successful in the next five years,” Mr. Ieng Tong warned. “It needs time to train human resources and do promotion about the services to people.”
Experts stressed that in the next five years, mobile banking in Cambodia will not improve significantly, but more people will understand how the service works and improvements are expected to be made.
According to the Ministry of Posts and Telecommunications, about 21 million mobile phone SIM cards were sold by the end of last year, or about 1.4 per person. When compared with other ASEAN countries, Cambodia’s percentage of mobile phone users ranks second to Singapore.
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