In the 1990s, Cambodia went through a phase of extensive reconstruction following the genocide of the Khmer Rouge (1975-79) and the Vietnamese occupation (1979-89). This situation created a highly competitive environment in which microfinance played an important role.

Since then, numerous microfinance institutions (MFIs) have emerged in the country, with 20 such institutions now licensed by the Central Bank. Between them they have around 1 million customers and affect the lives of some 5 million people in all, representing one-third of the population. Today, the Cambodian MFIs are clearly among the best performing in the world, whether measured in terms of size, rating or transparency, even though the country is relatively small and sparsely populated.

This climate of competition between the MFIs is beneficial for customers, as everyone we spoke to confirmed: it motivates employees, reduces prices and, above all, encourages innovation. These days, with repayment rates that are the highest in Asia, Cambodia is a veritable hive of microfinance activity.

Through various articles in this blog, our reporters will tell us about their meeting with four MFIs and about the experiences of some micro-entrepreneurs.

•    Read the FTT team’s travelogue on Cambodia…

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MICROFINANCE