Financial Inclusion and Fintech The views expressed in this presentation are those of the author and do not necessarily represent the views of the NBC. 2
Agenda Financial Inclusion Landscape Regulatory Framework Financial Inclusion Strategy Support Infrastructure for inclusion Challenges for Fintech Development 3
Financial Inclusion Landscape Access to Credit and Saving Payment Instruments Access to Payment Services 4
1,743 821,426 603,992 2,485 Access to Credit and Saving Number of Customer Deposit (2007 2017) 6,000,000 5,302,815 5,000,000 4,000,000 20,000 15,000 Value of Customer Deposit (2007-2017) (in Million USD) 18,897 3,000,000 10,000 2,000,000 1,000,000 5,000-2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017-2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 3,000,000 2,500,000 Number of Customer Loan (2007-2017) 2,531,574 25,000 20,000 Value of Customer Loan (2007-2017) (in Million USD) 20,713 2,000,000 1,500,000 1,000,000 15,000 10,000 500,000 5,000-2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017-2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 5
Payment Instruments Number of Checks Clearing, Cards, ATM machine, POS, Internet and Mobile Banking (2016 2017) 4,000,000 3,500,000 3,000,000 2,500,000 - Mobile Banking: 16 - Internet Banking: 17 - POS : 15,368 - ATM machine : 1,876 - Credit Card : 56,303 2,585,096 2,000,000 1,500,000 1,000,000 500,000 1,145,237 0 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Number of Mobile Banking operator Number of Internet Banking operator Number of POS Number of ATM machine Number of Credit Card Number of Debit Card Number of Checks Clearing 6
1,107,500 681,590 144,304 1,890,486 1,145,237 1,381,950 572,267 7,256,654 Payment Instruments Volume of Check Clearing, Debit Card, Credit Card, Internet and Mobile Banking (2016 2017) 40,000,000 35,000,000 36,004,655 30,000,000 25,000,000 20,000,000 15,000,000 16,163,447 10,000,000 5,000,000 0 2016 2017 Volume of Check Clearing Volume of Debit Card Volume of Credit Card Volume of Internet Banking Volume of Mobile Banking 7
Payment Services Network Number of Agents, Registered Customer and Walk-in Customer (2016 2017) 25,000,000 23,022 25,000 20,000,000 19,126,336 20,000 15,000,000 18,227 15,000 10,000,000 7,348,009 10,000 5,000,000-654,026 1,331,450 2016 2017 5,000 - Number of Registered Customer Number of Walk-in Customer Number of Agents 8
Payment Services Transactions Volume of Money transfer, Mobile payment, and E-commerce (2016 2017) Value of Money transfer, Mobile payment, and E-commerce (2016 2017) (in Million USD) 60,000,000 50,000,000 50,429,343 45,132,691 14,000 12,000 12,612 40,000,000 10,000 30,000,000 25,117,833 8,000 6,000 5,801 20,000,000 10,000,000 0 10,991,203 166,204 589,181 2016 2017 4,000 2,000 0 3,147 1,071 6 8 2016 2017 Volume of Money Transfer Volume of E-commerce Volume of Mobile Payment Value of Money Transfer Value of E-commerce Value of Mobile Payment 9
Regulatory Framework Law on the Organization and Functioning of the National Bank of Cambodia Law on Banking and Financial Institutions Law on Foreign Exchange Law on Negotiable Instruments and Payment Transactions Law on Anti-money Laundering and Combating the Financing of the Terrorism Law on Secured Transactions Draft Law on Consumer Protection Draft Law on E-commerce Draft Trust Law Draft Law on Competition Draft Law on National Payment System 10
Regulatory Framework Testing Environment Microfinance and Deposit Taking Institutions Other Credit Institutions and Credit Information Mean of Payment Credit Payment Service Institutions Deposit 11
Financial Inclusion Strategy Encourage Savings in Formal Financial Institutions Promote Innovative Credit Products for Consumers and MSMEs Prioritize the Development of a Well-Functioning Insurance Market Role of Capital Market in Financial Inclusion Banking Sector Capacity Building Non-Bank Sector Support Infrastr. Role of Fintech Strengthening the Capacity of the Financial Sector Regulator Encourage Saving in Formal Financial Institutions Promote Innovative Credit Products for Consumers and MSMEs Enable Expansion of Payment System Capabilities Increase Consumer Empowerment and Sector Transparency 12
Support Infrastructure Encourage Saving in Formal Financial Institution Promote Innovative Credit Products for Consumers and MSMEs Enable Expansion of Payment System Capabilities Increase Consumer Empowerment and Sector Transparency 13
Encourage Saving in Formal Financial Institutions Key Activities Promotion of Saving Culture Tax Incentive for Low- Income Clients Role of Agent to Collect Saving Support the Development of Low-Cost Approaches to Mobilize Saving Fintech Support Online Banking Services Mobile Banking Apps Automated Saving Programs Spending and Budgeting Programs 14
Promote Innovative Products for Consumers and MSMEs Key Activities Explore Modalities for Expanding Noncollateralized Credit for MSMEs Improved Credit Reporting and Credit Risk Assessments Establishment of A Well- Functioning Dispute Handling Mechanism Fintech Support Peer to Peer Lending Invoice Financing Smart Credit Decision Tools Credit Management Accounting and Bookkeeping Digital Payment and E- invoicing 15
Enable Expansion of Payment System Capabilities Key Activities Plan for Transition to Digital Transactions Facilitate the Development of Remittance Channels Incentivize Development of Payment Infrastructure Review Interconnection Options and Explore possibility for Regional Inter-linkages Forward Looking Regulations to Encourage Market Growth Fintech Support RTGS System Real Time Funds Transfer Central Shared Switch Online Platform Open API Payment Card and Mobile Payment APN Connection 16
Increase Consumer Empowerment and Sector Transparency Key Activities Promote literacy campaigns to address low level of financial literacy scenario Strengthen Consumer Protection Provisions Fintech Support Social Media Web Base Platform API for Information on the Products and Services Open Data Platform 17
Challenges for Fintech Development Legal Framework Standardization and Interoperability Consumer and Businesses Behavior Innovation and Stability Privacy and Cyber Security Money Laundering and Terrorist Financing 18
Thank for your attention! 19