Cambodian Financial Sector Embraces Sustainable and Ethical Practices
The financial landscape of Cambodia is witnessing a profound shift towards sustainability, responsibility, and community empowerment. This transformation spans commercial banks and microfinance institutions (MFIs), which are increasingly adopting ethical lending practices and aligning with environmental, social, and governance (ESG) principles. Since 2019, the Association of Banks in Cambodia (ABC), in collaboration with the National Bank of Cambodia (NBC) and the Ministry of Environment, has introduced guidelines to integrate ESG considerations into financial operations. These efforts have gained momentum, expanding from 48 to 74 members by 2024, including various commercial and specialized banks, as well as associations like the Cambodia Microfinance Association (CMA). The focus on sustainable finance includes initiatives such as digital transformation, financial literacy programs, and targeted campaigns to support rural communities and small businesses.
In 2019, the Cambodian Sustainable Finance Principles were launched, marking a significant milestone in promoting responsible finance across the banking sector. Institutions such as ACLEDA Bank have integrated ESG risk factors into their credit assessments and publish annual reports highlighting financial inclusion and environmental protection. Meanwhile, Maybank Cambodia enhances financial literacy among youth through its Cashville Kidz program, while ABA Bank focuses on educating rural populations about long-term financial security. MFIs under CMA demonstrate equal dedication, with AMK Microfinance serving predominantly rural clients, and LOLC Cambodia earning recognition for its commitment to gender equality and environmental sustainability.
Collaborations between CMA and the Credit Guarantee Corporation of Cambodia (CGCC) aim to enhance access to capital for small businesses, particularly women entrepreneurs and those in rural areas, by offering credit guarantees and financial literacy training. Commercial banks like Prince Bank and Cambodia Post Bank have developed specific products to support the growing entrepreneurial base in Cambodia. At the national level, multi-stakeholder consultations co-chaired by NBC and the United Nations address client protection and strengthen responsible lending practices, enforcing codes of conduct and consumer protection tools.
Community-level initiatives include major financial education campaigns led by both banks and MFIs, with ABC and CMA driving monthly digital financial literacy campaigns since 2020. Programs like "Safe Finance" distribute educational materials to raise awareness about borrower rights and financial safety. The National Financial Inclusion Strategy 2019–2025 provides a broader framework for integrating more Cambodians into the formal financial system, complemented by the Sustainable Finance Roadmap that aligns with national climate goals and global development targets.
To further improve trust in the financial system, the Financial Consumer Center offers avenues for resolving borrower disputes and enforcing Cambodia’s Lending Guidelines and sector-wide Code of Conduct. These measures ensure ethical lending practices and promote client welfare. Through these collective efforts, Cambodia's financial sector is not only driving economic growth but doing so responsibly, proving that sustainable finance is essential in emerging economies.
As Cambodia's financial institutions continue to prioritize transparency, sustainability, and long-term impact, they are setting a benchmark for Southeast Asia. By fostering inclusive growth and empowering underserved communities, the sector is demonstrating its commitment to building a stronger, more resilient economy. Through strategic partnerships and innovative programs, Cambodia is paving the way for a future where responsible finance becomes the norm rather than the exception.