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Cambodia’s Banking System
Cambodia is a developing countrywith a total population of 14.8 million (2005). Its 85%of the population lives in rural
areas where farming and fishing are themajor business activities. It is estimated that 36%of its population lived belowthe
poverty line. Cambodia faced decades of internal conflicts that destroyedmuch of its infrastructure and human resources.
Radical communist Khmer Rouge under the leadership of PolPot seized power fromthe princeNorodomSihanouk in 1975
and abolished money, private property and forced people to work in rural areas. About 1.7 million Cambodians were
estimated to have been mass murdered between 1975 and 1978...
ACLEDA’sMicrofinancial Initiatives
InMay 1992, an employment generation project named ‘The Small Enterprise and Informal Sector Promotion project’
was initiated for the social and economic rehabilitation of Cambodia. This was funded by theUNDP and executed by ILO.
In 1993, a nationalNGO, theAssociation ofCambodian Local EconomicDevelopmentAgencies (ACLEDA) was established
for the implementation of this project.Business training, credit, and counseling programs formicro and small enterpriseswere
developed and implemented...
ACLEDA: From Microfinancial Institution to Specialised Bank
The transformation intoabankwas enabled throughthetechnical assistance provided by theMekongProjectDevelopment
Facility financed by theUNDP, theUSAgency for InternationalDevelopment (USAID), and the IFC (International Financial
Corporation), a division ofWorld Bank, in 1998. This was the first assistance provided by IFC. The assistance
facilitated the upgradation of the existing policies, practices and organizational structure to be in tune with the international
accounting and banking standards.Under the transformation process, the original NGOtransferred its assets and liabilities
to the new ACLEDA bank, receiving 45%of capital worth $4million, while the ACLEDA Staff Association purchased 6%
equity stake. The remaining 49%stake was shared in equal parts by the IFC, DEG(subsidiary of Germany’s KfW), FMO
(The Netherlands’ Development Finance Company) and Triodos Bank, The Netherlands...
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