Logo of Phnom Penh Post newspaper Phnom Penh Post - NBC tests mechanism to link Kingdom’s major banks

NBC tests mechanism to link Kingdom’s major banks

A man exits an ATM in Phnom Penh.
A man exits an ATM in Phnom Penh. Pha Lina

NBC tests mechanism to link Kingdom’s major banks

The central bank officially held a soft launch last Friday for its central shared switch mechanism, which connects account records of three of the Kingdom’s leading financial institutions, allowing them to operate ATM and point-of-sale (POS) terminals in tandem.

In a move to increase interoperability of banking operations from different banks and microfinance deposit-taking institutions (MDIs), the National Bank of Cambodia (NBC) pioneered the Cambodian Shared Switch (CSS) mechanism and has fully launched it with Acleda Bank, Sathapana Bank and Prasac Microfinance.

The CSS mechanism enables customers who hold debit or credit cards issued by any one of the three financial institutions to access their accounts at any of the participating banks. All commercial banks and MDIs will be required to have the system in place by January of 2018, the NBC said in its Friday release.

“The development of the CSS is aimed at modernising payment system, reducing cash circulation in the market, enhancing efficiency of payment service in Cambodia and further stimulating inter-bank transaction by providing customers with additional transactional channels,” the NBC said in the announcement.

According to the announcement, the CSS allows for various types of transactions including the payment of goods and services, cash withdrawal, inter-bank fund transfer and balance inquiry.

Without the CSS mechanism, each local bank and MDI has to operate its own ATM network and POS machines. While there is some inoperability for cards backed up by major credit card labels, such as VISA’s Plus interbank network, the fee charges are generally high for transactions.

Just including Acleda, Sathapana and Prasac, the financial intuitions have a combined network of nearly 500 ATMs across the Kingdom with over 900,000 debit and credit cards issued.

While NBC representatives could not be reached for comment yesterday on the fee structure of the system, So Phonnary, vice president of Acleda Bank, said the CSS allows for both transactions in riel and US dollar with an interbank fee for withdrawals set at 1,800 riel ($0.44). She added that ATM interbank fund transfers fees are set at $1 for $1,000 and $2 for $5,000. The fees continue to rise according to the value of the fund transfer.

“The new system will be an option for financial institutions to reduce costs on infrastructure investment,” said Phonnary. “Other financial institutions that did not want to invest in new ATMs or POS machines can just issue the cards for customers and they can rely on larger networks.”

Say Sony, vice president of Prasac, said that the new system is very useful and shows how quickly electronic payment systems have been deployed in Cambodia to give customers better access to financial services.

“There is an increasing trend towards cashless transactions and we see that consumer behaviour shows a willingness to embrace new technology and easy electronic payments,” he said. “It is a good trend for both customers and financial institutions.”

MOST VIEWED

  • Proof giants walked among us humans?

    For years a debate has waged about whether certain bas relief carvings at the 12th-century To Prohm Temple, one of the most popular attractions at the Angkor Wat Temple Complex in Siem Reap province, depicted dinosaurs or some rather less exotic and more contemporary animal,

  • Japan bank buys major stake in ANZ Royal Bank

    Japan's largest bank acquired more than half of ANZ’s shares in Cambodia on Thursday, according to a statement from Kith Meng’s Royal Group. Japan's JTrust Bank, announced that they had acquired a 55% of stake in ANZ Royal Bank. According to a Royal Group

  • Long way to go before Cambodia gets a ‘smart city’

    Phnom Penh, Siem Reap and Battambang will struggle to attain smart city status without adopting far reaching master plans, according to officials tasked with implementing the program. The brainchild of the Association of Southeast Asian Nations (Asean), the smart city program seeks to link up

  • China-Cambodia tourism forum held

    The Cambodian tourism sector must be prepared to welcome a growing number of Chinese tourists, as they lead the globe in the number of outbound travellers and were responsible for the most visitors to the Kingdom last year, the country’s tourism minister said on