A new microfinance institution (MFI), ORO Financecorp Plc, is set to open in Cambodia, according to the director-general of the National Bank of Cambodia (NBC).
“ORO have [received] principle approval by the NBC on 11 March 2013, [but there is] no request from them for a licence so far,” Nguon Sokha said yesterday.
She said the new MFI’s shareholders were locally based.
Cambodia already has 35 registered MFIs, according to a recent report by the Cambodia Microfinance Association (CMA).
Bun Mony, president of the CMA and chairman of Sathapana Limited, said he was unaware a new player was entering Cambodia’s microfinance market.
But despite industry fears that the market is becoming overcrowded, Mony said he still felt there was more room for able competitors.
“I think it depends on the player and the experience and the professionalism they bring to the market, and from my point of view, I would say that the microfinance market still has viable room to grow.
“Maybe you look at [the] general economic industry that it has a large demand for capital, for loans, for the local entrepreneur to grow their business.
“That’s why I say it depends on the player – whether they are professional enough or not,” he said.
Representatives of ORO Financecorp declined to comment when contacted by the Post last Thursday.
Last week, the Post reported that the loan portfolios of the 35 registered MFIs and four NGOs that are members of the CMA reached $1 billion at the end of March, a 41 per cent increase from the same time last year.
According to recent figures from the CMA, deposits made at seven microfinance institutions reached $346 million, a 145 per cent increase over the past 12 months.
Mony told the Post that rural economic activity is growing and rural residents’ increased knowledge of formal financial has contributed to the rise in deposits.