Three months since the central bank soft-launched its FAST payment system it is taking the system public, making electronic riel-denominated transfers available to the customers of more than a dozen financial institutions.
The National Bank of Cambodia (NBC) launched the Fast and Secure Transfer (FAST) payment system in April on a trial basis with just five financial institutions participating in the scheme, and providing services only to the staff of these institutions. Today it will open the system for account holders at 13 commercial banks and micro deposit-taking institutions (MDIs).
According to Neav Chanthana, NBC’s deputy governor, the FAST system was designed to enable customers to make payment transactions and fund transfers in Khmer riel instantaneously from one commercial bank or MDI to another. She said its adoption will have a broad impact on the health of the local financial sector.
“[The FAST system] will promote the use of local currency, enhance transparency through electronic payment, reduce cash circulation in the market, and finally, improve effectiveness of financial resources utilisation,” Chanthana said in a release issued on Friday.
She added that Cambodia was gradually shifting from a cash-based economy to an electronic payment culture as more financial institutions launch internet or mobile banking and expand their ATM networks.
As of today, customers at seven banks – Acleda Bank, Cambodia Public Bank, Canadia Bank, ABA, BIDC, Phillip Bank, and Sathapana Bank – can use the FAST system. Six MDIs can use it too: AMK, VisionFund, Prasac, Amret, Kredit and Hattha Kaksekar.
Ly Thay, senior vice president and head of the operations division at Acleda Bank, one of the banks that participated in the FAST pilot program, said the new riel-denominated payment transfer system helps to reduce time and fees on transactions between banks or MDIs.
“The most important benefit of the new system is its ability to transfer money from one bank to another at a fast speed,” he said.
“The transaction fee is also very much lower than before.”
According to Thay, a $5 fee previously applied to transfers of funds between domestic banks for amounts less than $5,000, and $10 for larger amounts.
With the new FAST system, riel-denominated transfers of less than 4 million riel ($1,000) are charged a transaction fee of 4,000 riel, while those from 4 million riel to 20 million riel are charged 8,000 riel. Transfers of amounts exceeding 20 million riel are charged 12,000 riel.
For now, bank customers must physically visit a participating bank branch to initiate an electronic transfer or payment. In future, however, they will be able to do this online or through mobile banking.
Charles Vann, vice chairman of Association of Banking in Cambodia, said the FAST system will help improve and encourage electronic fund transfers, such as those used for bill payments, remittances or online purchases.
“The FAST system contributes to boosting business activity as it facilitates the ordering of goods and payments are made the same day,” he said.“It will also help to boost e-commerce activity.”