While the banking and microfinance industries are flourishing at a formidable rate across the Kingdom, a rugged, under-the-table practice still prevails among people in the lower-income class.

This practice is referred to as ‘money counting’ – directly translated from Khmer – where one loans money from a lender with a daily instalment payback rate.

Whereas borrowers are normally low-income individuals or families, the usurers are from the sphere of earning decent wages.

‘Money counting’ bears a shockingly high interest rate from 15 percent to 30 percent, and is still very much active in the vast majority of Cambodians not only holding low-paying jobs, but also owners of SMEs, market merchants, factory workers, and construction workers alike. Borrowers and usurers are typically acquainted with one another, making it a home-free run for them to borrow without black and white agreements.

Nevertheless, in Cambodian society, usurers usually loan the money in moderate amounts – an amount in which they believe their borrowers have the ability to pay in the time limit.

Samnang, a 40-year-old seamstress from Khan Toul Kork, said that her becoming a ‘money counter’ was completely accidental. Her neighbours, who are less well-off than she is, had started coming to her to borrow funds, with the promise of repaying at a 15 to 30 percent interest rate. As time passed, borrowers become more regular as word spread, eventually leading her to her second job of being a ‘money counter’.

“For me, I only have the ability to lend people money within the range of 40,000 riel and below, and the maximum time limit can only be stretched to two or three months,” she said.

However, she noted, “there are also ‘money counters’ on the other side of the road, and they only lend the money to market vendors. These lenders can go as high as a couple hundred dollars per customer.”

Some usurers have gone a step further, coming up with the concept of ‘buy now, pay later’. A middle-aged couple from Khan Mean Chey, requesting anonymity, explained, “Some of our customers want to buy a set of jewellery that costs about a couple hundred dollars; so we pay the money in advance and collect them from customers afterwards, in two or three weeks.”

It might seem a concept alien to many from developed countries, but the convenience of lending money and operating interest-bearing loans is not all that frowned upon within the Cambodian community.

In a short amount of time, people can get a loan at any time of day. Moreover, both parties do not require any written contract, preferring to place blind faith in each other.

Nevertheless, the lenders claimed that there had been incidents when they were tricked and the money was not repaid; however, they declared at the same time, “They didn’t swindle us completely; a small portion of the money was at least repaid.”

According to various interviews with different sources, the amount of money that is lent usually ranges from $25 to $50, and at most $250. The time limit of the loan is usually from three days up to a month depending on the individual arrangement.

Srey Pov, a 20-year old garment worker living in Phnom Penh, said the employees at her workplace tend to get interest-bearing loans.

“The reason they pushed us to borrow the money was the fact that factory owners tend to give us our wages late and are inconsistent,” Pov said.

Yang Sophorn, chief of the Cambodian Alliance of Trade Unions (CATU), said ‘money counters’ across factories seem to frequently exploit the garment workers.

“They lend their money at a 20 percent interest rate,” she said.

Um Vuthdara, an economics professor at the Pannasastra University of Cambodia, explained that operating interest-bearing loans is “a unique service in which both parties are guaranteed by trust.” He continued, “This kind of service does not require a written contract or any form of written agreement.”

Vuthdara noted that ‘money counting’, while operating outside of a regulated system, was no different from the microfinance and banking business.

Apparently, this kind of service offers many benefits: “When the borrower uses the borrowed money to invest in something worthwhile like starting a business or expanding it, or maybe even using it to further an education, both parties are benefiting the economy.”