ANZ, MFI Partner to Bridge Financial Sectors

ANZ Royal Bank and local microfinance institution Hattha Kaksekar Limited (HKL) on Monday entered into the first partnership of its kind in Cambodia in a bid to bring together clients from either side of the financial spectrum.

Following the signing of a Memorandum of Understanding at the Sofitel Phokeetra Hotel, ANZ Royal CEO Grant Knuckey said the partnership, between a commercial bank and microfinance institution, will facilitate transactions between clients and give ANZ a greater presence outside cities.

“ANZ’s corporate client base consists mainly of larger local and foreign corporates, many of whom operate significant production and distribution facilities outside the main centers (in the provinces) where ANZ doesn’t have a physical presence,” Mr. Knuckey said via email.

“These large companies generally have suppliers and distributors who may be very small [small and medium enterprises], and who need to either make or receive payments—often in cash—to and from these larger companies in the supply chain.”

As it is not possible for ANZ to facilitate these transactions in more rural areas, it will tap into HKL’s existing network of such clients across the country, Mr. Knuckey said.

HKL CEO Hout Ieng Tong said the MFI’s customers would benefit from a greater variety of financial products and services through ANZ.

“If we have a big customer, we can introduce them to ANZ and give our customers access from the 80 ATMs Hattha has to the more 100 ATMs that ANZ has.” he said.

Chea Serey, director general of the National Bank of Cambodia (NBC) said at the signing that the NBC has long been trying to “break the wall” between the microfinance sector and banking system.

“In the past, it was very difficult to connect the banking systems and microfinance. There were a lot of issues of confidence between the sectors among each other,” she said.

Bun Mony, chairman of the Cambodia Microfinance Association, said the partnerships between MFIs and commercial banks could potentially expand access to capital across the country.

“MFIs are popular with poor people but the institutions lack funds to provide loans to each customer,” he said. “So commercial banks here can offer more funds to the MFIs and their customers.”

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