Logo of Phnom Penh Post newspaper Phnom Penh Post - VisionFund receive MFI licence for deposits

VisionFund receive MFI licence for deposits

VisionFund receive MFI licence for deposits

MICROFINANCE institution VisionFund Cambodia has received a licence from the National Bank of Cambodia to accept deposits, according to a statement from the firm.

The service will allow the MFI to diversify its financial products on offer to lower-income households, it said.

“Apart from our strong financial position, our current systems, facilities and human resources are well placed to launch the deposit service,” CEO Chee Chin Hoe said in the statement.

“Our next approach will focus on further efforts to promote public awareness to recognise us as a safe and worthy custodian and manager for their deposits, and at the same time we hope to inculcate the habit of saving among the poor.”

The MFI said in the statement that deposits made at VisionFund in riel for one year would earn up to 9 percent per annum, while riel deposits for two years would earn 10 percent per annum. Deposits made in US dollars would earn annual rates of 7 percent and 8 percent, respectively.

Julie Cheng, Director at BlueOrchard Finance, a large-scale lender to the Kingdom’s MFI industry, wrote VisionFund Cambodia’s move to accept deposits was an important one, as it allowed access to bank savings accounts to Cambodians who might not otherwise have it.

The minimum balances of traditional banks are typically above what low-income Cambodians can maintain, among other conditions that make bank accounts inaccessible, she said.

According to Cheng, MFIs also typically have a larger branch network than most Cambodian commercial banks, and they also penetrate more deeply into the rural areas.  

“They can help educate consumers about the benefits of savings, as well as provide a secure place for clients to put their savings, however small,” she said.

“In the long run, deposits will also be a way for MFIs to diversify their funding sources and reduce their funding costs,” she added.

VisionFund Cambodia currently claims a loan portfolio of more than US$31 million with over 104,000 borrowers mostly in suburban and rural areas, focusing on Phnom Penh and some 17 provinces the company said.

MOST VIEWED

  • Stock photo agencies cash in on Khmer Rouge tragedy
    Stock-photo companies selling images from S-21 raises ethics concerns

    A woman with short-cropped hair stares directly into the camera, her head cocked slightly to the side. On her lap is a sleeping infant just barely in the frame. The woman was the wife of a Khmer Rouge officer who fell out of favour, and

  • Defence Ministry denies weapons in smuggling case came from Cambodia

    After a Thai national was arrested last week for allegedly smuggling guns from Cambodia to Thailand, Cambodia's Defence Ministry has claimed the weapons seized during the arrest are not used in Cambodia, despite the fact that both types of rifle seized are commonly found in

  • Prime Minister: Take back islands from inactive developers

    The government will “take back” land on roughly 30 islands from private companies that have not made progress on planned developments, Prime Minister Hun Sen said in a speech on Monday that also targeted land-grabbing villagers and idle provincial governors. Speaking at the inauguration of the

  • Land on capital’s riverfront is opened up for investment

    The government has signed off on a proposal to designate more than 9 hectares of land along Phnom Penh’s riverfront as state-private land, opening it up for private investment or long-term leasing. The 9.25-hectare stretch of riverfront from the capital’s Night Market to the