I just returned from a long weekend in Siem Reap where I spent a wonderful time with Pou Kyry, my uncle who lives in California. Pou Kyry modestly calls himself an amateur photographer but the fact that one of his pictures of a Khmer classical dancer was published in UNESCO's handbook on intangible heritage is testimony of his photographic gift. I had the privilege to visit the dance school located in the village next door to downtown Siem Reap where that very same Apsara (celestial nymphs found in many Hindu legends and courting the walls of Cambodia’s temples) trains amongst her fellow apsaras and hanumans (ape-human general famed for his feats especially in the Hindu epic, the Rayamayana). On the day of our visit, they were rehearsing for an evening performance to be held at Prasat Kravan, one of Angkor's hundreds of temples. The sweat dripping down the young performers' supple bodies as they morphed their hands into lotus flowers and vines was telling of their dedication and passion to bring back the conscience of Khmer classical dance.
On Saturday night, Pou Kyry and I checked out a khmer-barang live band called the Cambodian Space Project (barang originally referred to the former French colonialists but today refers to Western foreigners in general). They infuse a rocky edge to cover popular Khmer songs from the 60s and 70s. The lead singer is a lady in her 30s from Prey Veng province, one of Cambodia’s poorest provinces, and the other band members include a mix of barang and East Asian artists. The bar goers seemed to enjoy their performance which spoke to love, youth, and that wiiiiiiiiiiiiiiild thang. The band is travelling to Hong Kong this weekend for an international music festival so I look forward to seeing them hopefully groove their way up Cambodia's billboard music charts!
To top everything off, literally, we rode a balloon 100+ meters into the sky to get a god’s eye view of Angkor Wat, Cambodia's national treasure. If a Khmer house is not adorned with a painting or wooden sculpture of Angkor Wat, it can be found on the national flag. The ancient Khmer kings were successful in mobilizing the people to build this estate in homage to Vishnu, Hinduism's Supreme God. Waking up before the sun was definitely worth seeing the sacred grounds from a divine perspective: the temple rose from a sensual mist teased with pinkish purple hues, occupying the space of a century's worth of sweat, Angkorean (or herculean) strength and artistic finesse!
Along our travels, I took the opportunity to conduct several interviews to complement my research on savings mobilization in the microfinance sector. For the past two decades, microfinance has certainly picked up institutional gaps left by the financial and banking sectors by providing financial services to low-income populations. Microfinance operators in Cambodia have generally concentrated their efforts in the provision of credit, fueling the rural areas with cash to start businesses, invest in farming machinery, i.e. spend money. However very few microfinance institutions (MFIs) offer savings options despite the demand for savings products. In brief, microsavings provides individuals the opportunity to save small amounts of money by giving them the ability to turn irregular cash flows into lump sums for larger purchases, emergencies and investments.
Take for example Mr. Sok Heng, a Cambodian farmer. His crop yields are subject to the seasonal, recently temperamental, weather. During the harvesting months, Mr. Sok gathers mature rice from the fields and sells them to local markets or export businesses. During the rainy season, he is forced to seek shelter from the torrential downpours and thereby looks to the city to secure a source of income. However, Mr. Sok finds himself in a very competitive market, flushed like a fish in the sea; 80% of Cambodia's over 14 million people are farmers facing the same financial situation. Mr. Sok is very lucky if he can latch on to a job as a tuktuk or motodoup driver, yet even those jobs have already heavily saturated the cities. How can Mr. Sok, a hard-working and healthy individual, do during these times of rainy months yet drying wallets?
In 2007, the National Bank of Cambodia commissioned the Asian Development Bank to complete a technical assistance by conducting set of one qualitative and one quantitative survey each on savings habits in Cambodia. Both survey results suggest that rural and urban Cambodians have a high propensity to save, suggesting in economics terms a demand to save. However, given the irregular and piecemeal inflow of cash, a large majority safeguard their assets in the purchase of gold, land, and livestock, also suggesting a demand to save. Unfortunately, not everyone saves their money wisely and easily because it requires people to override a natural instinct to satisfy current wants and needs over future ones. For instance, how can I resist one of (fill in the blank here for whatever devilish treat you fancy) Oma’s homemade chocolate chip cookies and a shot of espresso, even after I’ve had plenty to eat?
Cravings and stomach rumbles aside, in December 2007 the NBC passed a PRAKAS (government edict) on Licensing of Microfinance Deposit Taking Institutions allowing MFIs to collect savings from the general public. This marked a big step in the development of Cambodia’s microfinance sector for both the MFIs as well as their clients. MFIs now had access to a cheaper source of financing and decrease their operational dependency on expensive foreign investments while clients could not only save money but also earn interest on every dollar/riel put aside. The 4 MFIs, who have obtained a deposit license since the inception of the PRAKAS, namely SATHAPHANA, Amret, HKL, and Amk, have surely benefited from expanding their product catalogue but also face new challenges. MFIs have to meet a list of stringent requirements, including a minimum reserve and 3 consecutive years of healthy operations, set to ensure depositor protection. In addition, MFIs need to market their savings services and build trust and credibility in the financial sector.
My goal for the interviews is to gauge the awareness of microfinance operations, familiarize myself with local savings habits and identify best practices to respond to the demand for savings products. With a voice recorder in hand and Pou Kyry by my side, I was able to survey a refreshment vendor on the Angkor Wat grounds and two tuktuk drivers in a nearby village about their savings habits. Subjects 1, 2, and 3 expressed a desire to save, with only Subject 3 actually having a savings account with ACLEDA, one of the biggest commercial banks. Subject 3 also has friends who are clients of MFIs but was not so clear on what microfinance is while Subjects 1 and 2 had no knowledge of microfinance. This sample is obviously too small for me to make any conclusions yet, but the general trend and their asking for MFI locations in the area are indicators that there is a demand for savings products. MFIs have indeed responded by developing appropriate savings products but also must concentrate on marketing efforts to inform the public on the availability of their savings products.
The interviews gave me a dry run to practice conducting interviews and pointed to the techniques I need to fine-tune. They also helped me to come up with a list of activities I need to do to complement my research on savings mobilization, so please stay tuned!
On Saturday night, Pou Kyry and I checked out a khmer-barang live band called the Cambodian Space Project (barang originally referred to the former French colonialists but today refers to Western foreigners in general). They infuse a rocky edge to cover popular Khmer songs from the 60s and 70s. The lead singer is a lady in her 30s from Prey Veng province, one of Cambodia’s poorest provinces, and the other band members include a mix of barang and East Asian artists. The bar goers seemed to enjoy their performance which spoke to love, youth, and that wiiiiiiiiiiiiiiild thang. The band is travelling to Hong Kong this weekend for an international music festival so I look forward to seeing them hopefully groove their way up Cambodia's billboard music charts!
To top everything off, literally, we rode a balloon 100+ meters into the sky to get a god’s eye view of Angkor Wat, Cambodia's national treasure. If a Khmer house is not adorned with a painting or wooden sculpture of Angkor Wat, it can be found on the national flag. The ancient Khmer kings were successful in mobilizing the people to build this estate in homage to Vishnu, Hinduism's Supreme God. Waking up before the sun was definitely worth seeing the sacred grounds from a divine perspective: the temple rose from a sensual mist teased with pinkish purple hues, occupying the space of a century's worth of sweat, Angkorean (or herculean) strength and artistic finesse!
Along our travels, I took the opportunity to conduct several interviews to complement my research on savings mobilization in the microfinance sector. For the past two decades, microfinance has certainly picked up institutional gaps left by the financial and banking sectors by providing financial services to low-income populations. Microfinance operators in Cambodia have generally concentrated their efforts in the provision of credit, fueling the rural areas with cash to start businesses, invest in farming machinery, i.e. spend money. However very few microfinance institutions (MFIs) offer savings options despite the demand for savings products. In brief, microsavings provides individuals the opportunity to save small amounts of money by giving them the ability to turn irregular cash flows into lump sums for larger purchases, emergencies and investments.
Take for example Mr. Sok Heng, a Cambodian farmer. His crop yields are subject to the seasonal, recently temperamental, weather. During the harvesting months, Mr. Sok gathers mature rice from the fields and sells them to local markets or export businesses. During the rainy season, he is forced to seek shelter from the torrential downpours and thereby looks to the city to secure a source of income. However, Mr. Sok finds himself in a very competitive market, flushed like a fish in the sea; 80% of Cambodia's over 14 million people are farmers facing the same financial situation. Mr. Sok is very lucky if he can latch on to a job as a tuktuk or motodoup driver, yet even those jobs have already heavily saturated the cities. How can Mr. Sok, a hard-working and healthy individual, do during these times of rainy months yet drying wallets?
In 2007, the National Bank of Cambodia commissioned the Asian Development Bank to complete a technical assistance by conducting set of one qualitative and one quantitative survey each on savings habits in Cambodia. Both survey results suggest that rural and urban Cambodians have a high propensity to save, suggesting in economics terms a demand to save. However, given the irregular and piecemeal inflow of cash, a large majority safeguard their assets in the purchase of gold, land, and livestock, also suggesting a demand to save. Unfortunately, not everyone saves their money wisely and easily because it requires people to override a natural instinct to satisfy current wants and needs over future ones. For instance, how can I resist one of (fill in the blank here for whatever devilish treat you fancy) Oma’s homemade chocolate chip cookies and a shot of espresso, even after I’ve had plenty to eat?
Cravings and stomach rumbles aside, in December 2007 the NBC passed a PRAKAS (government edict) on Licensing of Microfinance Deposit Taking Institutions allowing MFIs to collect savings from the general public. This marked a big step in the development of Cambodia’s microfinance sector for both the MFIs as well as their clients. MFIs now had access to a cheaper source of financing and decrease their operational dependency on expensive foreign investments while clients could not only save money but also earn interest on every dollar/riel put aside. The 4 MFIs, who have obtained a deposit license since the inception of the PRAKAS, namely SATHAPHANA, Amret, HKL, and Amk, have surely benefited from expanding their product catalogue but also face new challenges. MFIs have to meet a list of stringent requirements, including a minimum reserve and 3 consecutive years of healthy operations, set to ensure depositor protection. In addition, MFIs need to market their savings services and build trust and credibility in the financial sector.
My goal for the interviews is to gauge the awareness of microfinance operations, familiarize myself with local savings habits and identify best practices to respond to the demand for savings products. With a voice recorder in hand and Pou Kyry by my side, I was able to survey a refreshment vendor on the Angkor Wat grounds and two tuktuk drivers in a nearby village about their savings habits. Subjects 1, 2, and 3 expressed a desire to save, with only Subject 3 actually having a savings account with ACLEDA, one of the biggest commercial banks. Subject 3 also has friends who are clients of MFIs but was not so clear on what microfinance is while Subjects 1 and 2 had no knowledge of microfinance. This sample is obviously too small for me to make any conclusions yet, but the general trend and their asking for MFI locations in the area are indicators that there is a demand for savings products. MFIs have indeed responded by developing appropriate savings products but also must concentrate on marketing efforts to inform the public on the availability of their savings products.
The interviews gave me a dry run to practice conducting interviews and pointed to the techniques I need to fine-tune. They also helped me to come up with a list of activities I need to do to complement my research on savings mobilization, so please stay tuned!
