Dear all,
As a microfinance practitioner in Cambodia, I sympathize with what Jamie and Chuck have described. The picture they paint may however be too bleak. I would like to add two points for you to ponder:
1. The title of the press article mentioned by Jami is misleading. The prime minister Hun Sen does not advocate a general seizure of property of clients who cannot repay, his threat is a reply to a call by an opposition leader to refuse to repay loans issued by banks linked to Hun Sen's family. The following sentence, taken from the same article mentioned by Jami, provides a more balanced picture: Hun Sen: "... I encourage the banks to seize the collateral of those who believe the propaganda [by the opposition leader]. For those who are trying to pay off their loans, I appealed to the banks to understand them because this is a very hard time."
2. The National Bank of Cambodia has asked MFIs to restructure the loans of clients in difficulty in the current coronavirus pandemic. According to the Cambodian Microfinance Association, as of the third week of June, total restructured loans across all MFIs amounted to more than $1 billion with 220,000 customers given approval among 230,000 customers who have made a request. This is a very high approval rate and close to 10% of all MFI clients in Cambodia.
A final note on the NGO LICADHO mentioned by Jami. I met its staff last month to discuss its work on microfinance. They are frustrated that the sector does not heed their calls for change. Much of the sector is now profit-oriented, as Chuck has described, but most leading MFIs, I feel, still care about the Client Protection Certification of Smart Campaign, perhaps for their reputation and for attracting investors. According to LICADHO staff, the certification assessors who visit the Cambodian MFIs never talk to clients independently. This could perhaps be an improvement worth considering...
Kind regards,
Mingyee
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Posted by: Hsu Ming-Yee <mingyee0706@yahoo.fr>
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