Amret shows household economic growth plays important role in national growth and education

Chea Phalarin, CEO of Amret Microfinance Institution, behind his desk
Chea Phalarin, CEO of Amret Microfinance Institution, behind his desk. The MFI employs 2,890 staff in 128 offices across all 25 provinces. Moeun Nhean

Amret shows household economic growth plays important role in national growth and education

The launch of a new Amret branch in Steng Sen city, Kompong Thom province, marks the continued growth of the microfinance institution, and development of rural communities.

Employing 2, 890 staff in their 128 offices spread across all 25 provinces, Chea Phalarin, CEO of Amret Microfinance Institution said, “Amret’s employees are everywhere to serve clients and they are all qualified.”

Most of Amret’s emloyees are selected as children from families in the provinces. “We selected them and trained them about our business activities,” said Phalarin. “They also have their own resources such as knowing clients, local languages and geography, norms, and cultures of local people.”

Providing jobs to children of people in rural areas is one of Amret’s visions in improving people’s lives. “What’s important is that we honour them and they are proud to become qualified employees, having good jobs, good income in their hometown,” said Phalarin. “These are good models for our next generation.”

Amret provides three major services: first, providing loans to clients; second, a savings service; and third, transferring money.

Content image - Phnom Penh Post
Amret staff assemble for a Post Special photo. Moeun Nhean

“Today I noticed that Cambodian people are confident using microfinance institution, banks, and especially they know how to do business,” Phalarin said. “This is the sucessful service of a microfinance institution in providing a chance for our people to do business, improve their lives and their children’s education, which contributes to national growth.”

At present, Amret has 340,000 credit accounts among a total of 300,000 clients.

“It means that some clients have two accounts because they have two businesses,” explained Phalarin.

“As of October 2014, Amret provided loans of $285 million,” he said. “Meanwhile, we received savings from clients of about $152 million. About $50 million of that amount is from the 80 per cent of saving accounts in the provinces,” he said.

Phalarin said among those savers, some of them are clients who received loans from Amret. When they make profits, they bring that money to deposit in their saving account in Amret. When they need to use it, they will withdraw it back. So the money is circulating in the economy.

Amret started off as an experiment project for French NGO Gret in 1991. The bank was first called Ennatien Moulethan when it was initially registered with the Ministry of Commerce in 2000. In 2001, it was granted its first licence as a microfinance institution from the National Bank of Cambodia, before changing its name to Amret in 2004.

The bank was licensed to take deposits from the public in 2009 from the National Bank. Amret now provides individual loans, community andgroup loans, as well as enterprise loans.

Amret provides group loans in villages or communities, where clients are a group of people from the same village who can guarantee each other for the loan.

The loans are witnessed by the chief of village in order to get the loan from 100,000 Riel ($25) to over 1 million Riel ($350) for each guarantor. Such loans are used for their own business within 12 months period and over time help to improve the community with financial growth.

“For business loans, each individual can borrow from $350 to $15,000, while loans for small- and medium-sized enterprises are from $15,000 to $50,000,” said Phalarin.

“With every loan approval, Amret has an employee to analyse the career or business of the client, especially their own income, before providing loan.”

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