MFIs Seek Boosting Financial Literacy at Communal Level

PHNOM PENH – A project to strengthen financial literacy at the local level has been launched to promote knowledge related to finance, rights, and client protection as well as to increase clients’ access to formal financial services within communities.

The project, which goes by the name of “Strengthening Safe Finance in Community” will contribute to improving and developing people’s livelihoods. It is supported by the National Bank of Cambodia (NBC) and the Cambodian Microfinance Association (CMA).

Phal Vandy, CMA executive director, said the implementation is in the pilot phase for four target provinces, including Battambang, Kampong Thom, Kampong Speu, and Svay Rieng.

“The plan aims to take part in the financial environment strategy and to enhance formal financial services. [It’s] our big dream to see people who are our clients getting successful and improving,” Vandy said on Feb. 24 during the launching event.

​The pilot implementation will run over two years, in 2023 and 2024, and will then be expanded to other communes and districts in 2025 and 2026. A long-term action plan will then be implemented, from 2027 to 2030, and will make all frameworks available across the country.

Promoting knowledge within these rural areas is important to increase people’s understanding of finance, which enables them to make the right decisions and be capable of using their finance wisely.

“It will contribute to developing their livelihood at the family level, community level, and national level,” Vandy added.

​However, the plan can only be successful with the participation of all stakeholders in the finance sector.

Men Pheakdey, the director of the project organizing group, said the project will provide training for the instructors at the subnational and national levels. It will be implemented from February 2023 onward.

Pheakdey urges microfinance institutions (MFIs) and relevant actors who are interested in the project to send their staff to join in the training to become subnational or national-level trainers.

For MFIs who offer similar projects in improving the financial literacy of their customers, Pheakdey suggested they should harmonize their programs with the “Strengthening Safe Finance in Community” project run by CMA and NBC. And for those who already have initiatives or new project plans about strengthening education on finance, he advised supporting and implementing the CMA project too.

“If we implement our work together, safe finance in the communities will occur, which will bring financial safety to the community as a whole. In this sense we can transfer the work to the government to include it in the safe village-commune policy,” Pheakdey said.

Sok Voeun, CMA’s vice chairman, said the implementation requires close facilitation and cooperation among stakeholders as well as the public and authority.

“We will work together to guarantee the effectiveness of the implementation. We believe that it will play an important role in enhancing finance, rights, and client protection-related knowledge in Cambodia,” he said.

The “Strengthening Safe Finance in Community” project is an important initiative from the finance sector. It will be a major step in promoting financial integration, rights, and protection for clients.

“The project will improve the access of getting formal financial services, contribute to reducing poverty as well as boost economic growth and development,” he said.

Roth Sovannarak, NBC’s managing director, stated that the public’s trust in using formal financial services is the main factor for the national bank and relevant stakeholders to work harder in implementing such projects.

“All this work is aimed to maintain the banking system stability and to enhance the financial environment in the country,” he said.

Originally written in Khmer for ThmeyThmey, this story was translated by Meng Seavmey for Cambodianess.

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