Credit Bureau Cambodia (CBC) has successfully collaborated with international credit bureaus, starting with the first cross-border credit report sharing initiative between Cambodia and Singapore, aimed at enhancing financial inclusion and accessibility for Cambodians living and working abroad.

This milestone, achieved in partnership with Credit Bureau Singapore (CBS), marks a pivotal step forward in providing Cambodians with better access to credit in new markets, according to CBC’s 2023 annual report, "Leading the Way Towards Financial Inclusion with Innovative Credit Reporting".

On March 8, 2023, CBC and CBS formalised their collaboration during an official signing ceremony at the Park Royal Collection by Marina Bay in Singapore.

The event was attended by central banks, credit bureaus,and influential leaders from the banking and financial industries of both countries. 

The initiative allows financial institutions (Fis) in both nations, upon obtaining the individual's consent, to request and share credit reports, thereby facilitating more thorough assessments of an individual’s creditworthiness.

CBC chairwoman Chea Serey was quoted in the report saying, "Credit reporting plays a crucial role in enabling access to finance for Cambodians by bridging information asymmetry between lenders and borrowers."

“Our first successful bilateral cross-border credit reporting initiative with Singapore in 2023 marks a significant milestone, and we anticipate additional collaborations in Southeast and East Asia in the coming years," said Serey, also governor of the National Bank of Cambodia (NBC).

With increasing global workforce mobility, the ability to access credit reports across borders addresses a pressing need for Cambodians who seek opportunities abroad. 

The report stated that the initiative simplifies the process for Cambodians moving to Singapore to live and work, enabling them to conveniently provide their credit history from home to Singaporean FIs, thereby easing their access to credit in a new country.

In general, cross-border credit refers to the practice of lending or extending credit from FIs in one country to borrowers or entities in another.

This system is crucial in today's globalised economy, where individuals and businesses often operate across multiple countries and need access to financial services beyond their home nation.

“As of December 2023, CBC was serving a member base of 194 FIs, including commercial and specialised banks, microfinance institutions (MFIs), leasing companies and rural credit institutions. We generated more than 6.3 million credit reports this year,” CBC CEO Oeur Sothearoath said in the report.

He said the reporting database contains credit activities and repayment histories of more than seven million consumers – representing over 70 per cent of the adult population in the country – and more than 25,000 commercial entities, with contributions from more than 86 member FIs reporting commercial data.

Sothearoath noted that, due to the ongoing economic situation, loan restructuring is still in progress; as of December 2023, a total of 692,637 accounts had been restructured since 2020.

He said the integration of reporting is not just about improving access to credit but also about promoting financial health and responsible lending practices.

By providing a comprehensive view of an individual’s credit history, FIs can make more informed lending decisions, reducing the risks associated with lending to individuals without a verified credit background, he added.

"Thanks to the supportive regulatory environment established by the NBC, CBC has adeptly navigated the fast-evolving industry landscape while upholding trust and accountability," said Serey.

"With more Cambodians seeking opportunities abroad, accessing credit in new markets poses challenges. Thus, as a credit bureau, it is imperative for us to facilitate financial access for Cambodians domestically and internationally,” she added. 

Sothearoath mentioned that they also entered into a collaboration with the (South) Korea Credit Bureau to develop a similar report sharing mechanism, aiming to foster access to finance for the more than 50,000 Cambodians working there.

Building on the success of the initiative, CBC is looking forward to expanding its collaborations with other countries in the region, he said, adding that the aim is to establish a network of cross-border reporting systems that can support the financial needs of Cambodians working in different parts of Asia.

"Our operational resilience, infrastructural strength and acceleration towards digitalisation set a strong foundation for the next phase of growth,” said Sothearoath.

“We are enhancing our advanced data analytics capabilities to develop a continuous stream of credit reporting and value-added services in response to the needs of our members," he explained.

In addition to its efforts in cross-border credit reporting, he noted CBC is committed to promoting financial literacy and responsible financial management among consumers.

By leveraging digital technologies and data analytics, Sothearoath said CBC aims to foster financial inclusion for those new to credit by tapping alternative data sources.

Serey emphasised that it is essential for all current and prospective borrowers to have a proper understanding of credit reports and their implications.

She also noted that the strategic roadmap for the next five years is aligned with the government’s National Financial Inclusion Strategy.

Serey highlighted that the strategy focuses on advancing consumer financial literacy and management, enhancing the capacity of FIs to utilise data and digitalisation for responsible lending and promoting awareness across all sectors of the economy and society.