Collateral is often the main decisive factor in loan applications, but having the right financial documents and knowledge is of equal importance, say key insiders. To deal with this, three associations – the Association of Banks in Cambodia (ABC), Cambodia Microfinance Association (CMA) and Young Entrepreneurs Association of Cambodia (YEAC) – yesterday signed a memorandum of understanding (MoU) on a partnership to provide financial inclusion to young entrepreneurs and micro, small and medium-sized enterprises (MSMEs).
“An inadequacy of access to finance is often mentioned by our members and MSMEs in Cambodia as a major bottleneck for growth and vibrancy of entrepreneurship in Cambodia”, said YEAC President Seang Sopagna at the virtual signing ceremony.
Most recurring causes of limited access to finance are the lack of collateral, high interest rates, the absence of financial statements and a general lack of information on sources of debt financing, he said. The signed agreement will help to expand the scope of access to finance to support more young entrepreneurs and MSMEs. “The memorandum of agreement today is an essential milestone in our partnership and sets out key strategic areas of cooperation between our associations on matters of mutual interest relating to the training, workshops, events and guest speakers for online talk show programmes to improve financial literacy and the access to finance among Cambodia’s young entrepreneurs,” Sopagna said. “We will also work jointly on matters of gender equality, green and sustainable, socially responsible business initiatives promotions and awareness, technology, financial literacy, entrepreneurship-oriented events and efforts.” In Channy, chairman of the Association of Banks in Cambodia and president and group managing director, ACLEDA Bank Plc, said the partnership is in line with the government’s efforts to help MSMEs. “Through the MoU, all parties will jointly continue to build stronger financial literacy for the public, entrepreneurs and other small and medium enterprises.” Kea Borann, chairman of Cambodia Microfinance Association and CEO of AMK Microfinance Institution Plc, said the cooperation will be an important forum for financial professionals and young entrepreneurs to study, explore, create, test and implement innovative solutions to promote business development.
This article was first published in Khmer Times. All contents and images are copyright to their respective owners and sources.