Logo of Phnom Penh Post newspaper Phnom Penh Post - MFI gets $7M to offer low-cost housing finance

MFI gets $7M to offer low-cost housing finance

Content image - Phnom Penh Post
Located on a 45ha plot in Roka Khpos commune’s Koh Kor village, 14km south of the Monivong Bridge in the capital, Satellite Serei Mongkul City is set to offer 2,457 units. WORLDBRIDGE

MFI gets $7M to offer low-cost housing finance

Local microfinance institution (MFI) First Finance Plc has reportedly found backers for its plans to extend access to affordable housing finance to low- or middle-income borrowers.

The MFI has received an approximately $7 million debt financing package from Mauritius-based GuarantCo Ltd, a member of the London-headquartered Private Infrastructure Development Group (PIDG), and the US’ Cargill Financial Services International Inc (“CFSI”), GuarantCo noted in a statement dated just “December, 2022”.

“This is GuarantCo’s first transaction in Cambodia and marks the debut social loan in Cambodia. First Finance has committed to ensuring the use of proceeds will be administered in line with its Social Financing Framework based on the Loan Market Association’s Social Loan Principles on which Moody’s provided a Second Party Opinion [SPO],” the statement said.

GuarantCo CEO Layth al-Falaki voiced confidence in First Finance’s plans to provide the Kingdom’s low- and middle-income households with affordable housing finance, and hinted that his company and CFSI would consider extending similar financing solutions to other financial institutions in the future.

“We are excited to have closed our first transaction in Cambodia and to support First Finance’s provision of affordable housing finance to low- and middle-income households in the country.

“We hope that this innovative transaction, will increase familiarity with loan guarantees and longer-term debt solutions for Cambodia, and ultimately lead to a greater willingness to extend debt financing to similar institutions, thereby further developing the local capital markets in Cambodia,” the statement quoted him as saying.

First Finance CEO Sim Senacheert said in the statement: “This loan guarantee not only demonstrates First Finance’s ability to expand its operations responding to market needs but also reveals the credibility and trustworthiness that we have established with members of the public, and local and international investors.

“First Finance is committed to utilising GuarantCo’s loan guarantee to provide financing for affordable housing to around 470 low- and middle-income households in Cambodia to improve the quality of their livelihood.

“The stability of homeownership allows a family to live in a more hygienic and healthier condition so that they can spend time and energy on other aspects of their lives. It allows children to have access to clean water and sanitation in order to remain healthy and [be] able to study whilst women can start their own business or job,” he said.

The statement added that the transaction “is expected to support around 470 new loans targeted mainly to low- and middle-income households” and “enable First Finance to access their first-ever longer-term financing with a seven-year tenor, on a scale and at a lower cost of funding than would otherwise have been the case without GuarantCo’s involvement”.

It noted that the overall size of the facility could be increased to around $22 million “over the next two years”, “subject to certain criteria including market conditions”.

By some estimates, some 7.9 million people will be living in urban areas by 2030, up roughly five-sixths from 4.3 million in 2014. To this end, officials in June 2017 announced ambitious plans to meet the demand for some 55,000 affordable new homes each year.

At the time, Minister of Land Management, Urban Planning and Construction Chea Sophara predicted that, by 2030, an estimated 800,000 urban homes will need to be added to the 2015 housing stock to meet the demand of an expected national population of 19 million.


  • Joy as Koh Ker Temple registered by UNESCO

    Cambodia's Koh Ker Temple archaeological site has been officially added to UNESCO’s World Heritage List, during the 45th session of the World Heritage Committee held in Riyadh, Saudi Arabia, on September 17. The ancient temple, also known as Lingapura or Chok Gargyar, is located in

  • Famed US collector family return artefacts to Cambodia

    In the latest repatriation of ancient artefacts from the US, a total of 33 pieces of Khmer cultural heritage will soon return home, according to the Ministry of Culture and Fine Arts. In a September 12 press statement, it said the US Attorney’s Office for the

  • Tina rebuffs ‘false claims’ over falling paddy price

    Agriculture minister Dith Tina has shed light on the trade of paddy rice in Battambang – Cambodia’s leading rice-producing province – in a bid to curb what he dubs a “social media fact distortion campaign” to destabilise the market. While acknowledging that the prices of paddy

  • Cambodia set to celebrate Koh Ker UNESCO listing

    To celebrate the inscription of the Koh Ker archaeological site on UNESCO’s World Heritage List, the Ministry of Cults and Religion has appealed to pagodas and places of worship to celebrate the achievement by ringing bells, shaking rattles and banging gongs on September 20. Venerable

  • Kampot curfew imposed to curb ‘gang’ violence

    Kampot provincial police have announced measures to contain a recent spike in antisocial behaviour by “unruly’ youth. Officials say the province has been plagued by recent violence among so-called “gang members”, who often fight with weapons such as knives and machetes. Several social observers have

  • PM outlines plans to discuss trade, policy during US visit

    Prime Minister Hun Manet is set to meet with senior US officials and business leaders during his upcoming visit to the US for the UN General Assembly (UNGA), scheduled for September 20. While addressing nearly 20,000 workers in Kampong Speu province, Manet said he aims to affirm