‘Unlicensed private lenders cheat people’

inter v iewed, 22 had been forced to sell land or ta ke out credit wit h private lenders at higher interest rates to repay earlier loa ns.

“I think this is risky and dangerous for r ura l people whose lives depend on their land for farming. If t hey are forced to sell t heir fa rmland, t hey will lose t heir livelihoods.

“Our report found that [MFIs] did not seriously look into t he debtors’ abilit y to repay loa ns,” Sam Ath said.

‘Never force people’

Most of those inter v iewed said they had ta ken out loans for running small businesses and for farming purposes, he said.

However, Mony, who is a lso the president of Vithey microfinance, maintained that MFIs never forced people to sell of f assets to repay debt.

“Around two million Cambodians have taken loans from MFIs but only t wo per cent are late in making repay ments. If they can’t make payments on time, we help them solve the problem and never forcibly seize land or homes,” he said.

Mony said people remained v ulnerable to private lenders. “They are unlicensed private lenders . . . t hey cheat people,” he stressed.

Crackdown on illegal lenders

The NBC announced last week that it was look ing to collaborate wit h relevant sta keholders to crackdow n on illega l lenders.

Speaking at its first-half results meeting last week, Kith Sovannarith, the NBC’s deput y director-genera l of banking super v ision, said t he public was being a lerted to t he dangers of ta king out cash loans from unfamiliar sources.

He said the NBC was currently warning the public of Phnompenhloan, an illega l online lender using pictures of t he nationa l bank’s management to advertise loans on socia l media.

“The National Bank of Cambodia calls on people to be aware of Phnompenhloan, which is prov iding online loan ser v ices wit hout a licence from the NBC,” he said.

NBC figures show there are 81 licensed MFIs in the Kingdom, of which seven are microfinance deposit-ta k ing institutions (MDIs).

A Credit Bureau of Cambodia report said that non-performing loans after 30 days reached 1.24 per cent as of March, a slight increase on t he 1.18 per cent recorded at the end of December.

Approx imately 1.14 million Cambodians had applied for consumer loans as of the end of March this year – up 5.3 per cent from the end of December – wit h a loan portfolio of $ 6.7 billion, which is an increase of 7.4 per cent, t he report said.