Cambodia: Int’l digital payment firms ‘committed’ to de-dollarisation

• Apr 15, 2020

Visa Inc. is one of several international digital payment firms who have said they are committed to supporting the government and the National Bank of Cambodia (NBC) in their de-dollarisation mission.

A global leader in digital payments, Visa Inc are in the vanguard of firms who plan to encourage the increasing usage of riel, Cambodia’s national currency, which has competed against the dollar since the early 1980s. Aside from the national pride-boosting effect that de-dollarisation is expected to have, Monika Chum, Visa Country Manager for Cambodia, told Khmer Times that the policy is an opportunity to help the Cambodian economy become more resilient against volatility in the international market, while still increasingly connecting with the world through commerce.

“Visa’s ultimate goal is to become a long-term partner with Cambodia in the evolution of its digital ecosystem and we support measures that help to strengthen and create dynamism within the local market,” she said.

To assist in this implementation, the international payment firm is working closely with both the NBC and the Association of Banks in Cambodia (ABC), taking a step-by-step approach to work with local stakeholders to support this initiative.

Cambodia remains a highly dollarised economy, with the riel accounting for only about 20 percent of currency in circulation, according to a recent report from the Asian Development Bank (ADB). However, it acknowledged the central bank’s efforts to promote the use of the riel, notably requiring banks to fund at least 10 percent of their loan portfolios through the local currency.

“The central bank has also soght partners to help promote the use of the riel for transactions,” ADB said in the report.

China UnionPay, a Chinese financial services corporation, quoted this week, said that the company is prepared to implement card payment settlements in riels, as it responds to the demand of the market and the financial institutions where the firm serves and supports.

Last year, the number of UnionPay debit cards issued in Cambodia saw more than a 20 percent year-on-year hike, while card spending reached nearly 40 percent, according to the Netherland-based Paypers report.

Visa is also in the midst of localising settlement services for domestic transactions and has plans to set up currency settlement in riel.

Source: https://www.khmertimeskh.com/50713285/intl-digital-payment-firms-committed-to-de-dollarisation/