Logo of Phnom Penh Post newspaper Phnom Penh Post - Bank technology to take hit

Bank technology to take hit

Bank technology to take hit

090217_15.jpg
090217_15.jpg

Cambodia has rapidly caught up with the rest of the world when it comes to banking technology, but the downturn will slow development, industry says

BLOOMBERG

Phnom Penh branch of ANZ Bank. The sector has embraced technology, but the downturn could affect further development.

LEADERS in the country's IT industry expect that the global financial crisis will slow investment in Cambodia's banking technology, but are optimistic the sector is well-positioned for an eventual recovery.

"Had it not been for the world economic downturn, we would be expecting rapid development of banking technology - because that is always the case when one starts from behind," said Chum Sirath, managing director of Net I Solutions Co Ltd, a leading local IT firm.

Chum Sirath said that because services such as mobile banking and ATMs were new to the country, local banks could install cutting-edge systems immediately without having to perform costly upgrades on outdated technology. And, he said, they ought to do more - for instance, customers are not able to bank electronically.

Phu Leewood, secretary general of the government's National ICT Development Authority, said the country was in the comparatively early stages of IT enhancement in the banking sector. He said the banks ought to use the global downturn as an opportunity to upgrade.

Cambodian banks are embracing technology to entice more customers.

"IT is an essential investment that we can't leave behind," he said.

One area where money will be spent is in expanding the country's ATM network. ACLEDA, ANZ Royal and Canadia are all looking to add to their networks - adding as many as another 60 machines countrywide by the end of this year.

Sao Volak, chief executive of Campura Systems Corp, which does systems integration, said that impressive gains in banking technology have been made in the past few years as the number of ATMs increased and credit-card usage rose.

"Cambodian banks are embracing technology to entice more customers, and they view technology investment such as core banking, ATMs, electronic payment systems, mobile banking, network connectivity and credit card facilities as strategic assets to drive business rather than just to provide a link for customer services," Sao Volak told the Post by email.

"When financial markets recover, technology use will expand with it," he said.

Terry Mach, IT manager of ACLEDA Bank, said only a minority of businesses in the country were using technology that meets international standards. Banks are among the most important consumers of high-end technology here and are willing to spend more on IT development.

"Banks normally spend US$300,000 to $400,000 updating software because new versions are always available every year," he said. "But we don't generally catch up with all versions."

Core banking software was shown in a 2008 international study by Temenos Research to be the main component of banking IT expenditure - more than 80 percent of banks surveyed said their top priority for spending was their core banking system.

Chum Sirath at Net I Solutions said he expected that the proposed stock exchange would increase the country's technology development as local financial institutions raced to upgrade to international standards.

"Local banks need to continue investing in technology and position themselves for an economic recovery," he said.

MOST VIEWED

  • Guards protest dismissals, reject claims of sharing naked photos of child

    Some 20 former security guards at the US Embassy in Phnom Penh protested on Tuesday against their dismissal. They accused their employers of falsely claiming they had viewed and shared child pornography from their mobile phones as grounds for their termination. In total, 32 personnel were dismissed

  • We’re going to Wisney World!

    More than 6,000 mostly Chinese attendees witnessed the inauguration ceremony of a $1 billion Sihanoukville resort project called Wisney World in the capital on Wednesday. The event on Koh Pich, attended by several senior Cambodian government officials, is a joint venture between China’s AMC International and

  • Funcinpec urges probe into deadly Preah Sihanouk accident

    THE Funcinpec party has urged the government, especially the Ministry of Interior, to investigate the traffic accident in Preah Sihanouk province which left Prince Norodom Ranariddh badly injured and his wife Ouk Phalla dead. Funcinpec Vice President You Hokry told reporters at Botum Votey pagoda,

  • Gov’t continues China tilt as ties with the US slide on ‘interference’ in Kingdom’s internal affairs

    CHINA has granted some $131 million in aid to the Cambodian military. It comes as yet another sign that the Kingdom is strengthening strategic ties with its Asian neighbour to counter increasingly cold relations with the United States. The aid was announced as part of a