The macro behind microfinance: Cambodia's financial inclusion success story

• Main Author: Chang, Jonathan
• Format: text
• Language: English
• Published: Institutional Knowledge at Singapore Management University 2017
• Subjects: Cambodia; financial services; microfinancing; small and medium enterprises; Asian Studies; Entrepreneurial and Small Business Operations; Finance and Financial Management
• Online Access: https://ink.library.smu.edu.sg/lien_research/160; https://ink.library.smu.edu.sg/context/lien_research/article/1156/viewcontent/the_macro.pdf
• Institution: Singapore Management University

Financial inclusion refers to the delivery of affordable financial services to disadvantaged and low-income segments of society. However, as it also involves striking a fine balance between managing businesses’ credit risks and improving customers’ access to credit, different countries have made varied progress in their financial inclusion efforts. To date, across both developed and developing nations, SMEs and individuals still struggle in the face of limited access to adequate financing. Yet there is one country that has made considerable strides in this area: judging from the tremendous success of its microfinance sector, Cambodia seems to have found the sweet spot where businesses can confidently offer affordable loans to low-income individuals—under the watchful eye of the nation’s central bank. Serey Chea, Director General of the National Bank of Cambodia, chats with JONATHAN CHANG, Executive Director of the Lien Centre for Social Innovation and Editor-in-Chief of Social Space, on how careful regulation, financial literacy and technology are key to improving financial inclusion.