Phnom Penh: The National Bank of Cambodia (NBC) and the United Nations (UN) in Cambodia will further foster a fair and transparent banking and financial ecosystem through responsible and inclusive practices that empower individuals, particularly the most vulnerable, while contributing to Cambodia’s sustainable development and economic stability.
According to Agence Kampuchea Presse, the commitment was made known through the 2nd high-level multi-stakeholder dialogue, co-convened by NBC and UN in Cambodia last week in Phnom Penh. In the consultation meeting, a comprehensive series of discussions were conducted, including individual stakeholder group dialogues and technical multi-stakeholder meetings, engaging representatives from over 100 groups and institutions across government, regulatory bodies, banking and financial institutions and associations, investors, civil society and non-government organisations, think tanks, development partners, UN agencies, and international financial institutions.
Among the 22 priority actions initiated in the inaugural high-level multi-stakeholder meeting in July last year, 4 have been completed, 15 are in progress, and 3 are being initiated. Key milestones include strengthening responsible lending practices, significant progress in enhancing responsible lending standards, and enforcing the implementation of the Code of Conduct. Additionally, the Consumer Protection Harmonisation Assessment Tool is set to be adopted, with 30 banking and financial institutions (BFIs) participating in upcoming third-party assessments.
Lending guidelines have been reinforced, prohibiting the use of Indigenous Communal Land Titles (ICLTS) as collateral and preventing forced sales of such titles. BFIs now have online access to information on registered hard titles of ICLTs and state-owned lands, which are legally restricted from being used as collateral.
The alignment of BFIs’ incentives is under review, with key performance indicators being revised to align with the principles outlined in the Code of Conduct, Responsible Lending Guidelines, and the overarching principle of “Do No Harm”. Legal safeguards have been prepared to enforce existing regulations against the misuse of identification documents as collateral in lending practices.
Efforts to strengthen consumer protection and enhance complaint resolution mechanisms are underway, including the establishment of a Financial Consumer Centre under the Association of Banks in Cambodia (ABC) and the Cambodia Microfinance Association (CMA). Initiatives such as independent debt counseling and mediation mechanisms, expanded financial literacy, and customer empowerment programmes are being introduced to better inform borrowers, particularly those facing debt stress.
Data ecosystem and loan restructuring efforts are being examined, prioritising borrowers experiencing financial difficulties, including vulnerable and indigenous groups. CMA and ABC have proposed a definition of microfinance operation for the banking and financial sector, which will be submitted to NBC for review and stakeholder input.
Innovations in insurance include a pilot climate risk and crop insurance programme under a Modern Agricultural Cooperative, launched with private sector support. Further exploration is required to identify the optimal insurance model for scaling up this initiative. Enhanced coordination and funding support are needed to empower Modern Agricultural Cooperatives in providing market access and credit opportunities for indigenous communities with ICLTS.
The NBC and UN will continue to monitor progress, with the next high-level multi-stakeholder dialogue scheduled for August 2025.