The Kingdom’s central bank and the Cambodia Microfinance Association (CMA) have jointly launched a project aimed at promoting financial literacy, consumer empowerment and consumer protections at the community level.

According to a February 27 press release from the CMA, the primary objective of the project – “Strengthening Safe Finance in Communities” – is to enhance the safe and secure use of formal financial services and increase access to these services. The project is in alignment with the government’s “safe village-commune” policy and aims to discourage the use of the informal – and typically illegal – traditional alternatives to those services.

The project will be piloted in Kampong Thom, Kampong Speu, Svay Rieng, and Battambang provinces in 2023 and expanded in the following years.

The press release said the project design is based on various research studies conducted in 2022 by Japan International Cooperation Agency (JICA) and the CMA, with support from the NGOs Cerise+SPTF and ADA.

The studies included a consultative workshop with local authorities and all had similar findings on the importance of financial literacy leading to financial inclusion at the grassroots level.

“The findings of the research reflect on the important role of citizens and local authorities in helping to promote and mainstream financial literacy for access to formal and safe financial services to improve their livelihood,” the CMA statement said. “The project’s implementation calls for the active participation and support from the National Bank of Cambodia [NBC], CMA, state agencies, authorities, local and international NGOs, development partners and key stakeholders.”

Rath Sovannorak, assistant governor and director-general of banking supervision at the NBC, said: “Public confidence in the formal financial sector is crucial, so the NBC and stakeholders have been putting great efforts into strengthening financial literacy and consumer protection to maintain the stability of the whole banking system and increase financial inclusion in Cambodia.”

The project steering committee, chaired by the NBC and co-chaired by the CMA, will oversee the project’s implementation and ensure its alignment with the National Strategy on Financial Inclusion 2019-2025 and the Financial Sector Development Strategy 2016-2025.

“The project’s implementation requires close coordination and collaboration among stakeholders, including citizens and local authorities. We will work together to ensure an effective implementation of the project. We are confident that it will contribute significantly to enhancing financial literacy, consumer empowerment and protection in Cambodia,” CMA chairman Sok Voeun said.

The project’s successful implementation will improve access to formal financial services, contribute to poverty reduction and enhance economic growth and development in the country, according to the press release.