Cambodia’s financial sector was given a boost on Friday following the approval of a $40 million loan and a $600,000 technical assistance grant by the Asian Development Bank (ADB), with the aim of bringing the Kingdom’s unbanked population into formal financial services.
The loan and grant comes via the ADB-funded Inclusive Financial Sector Development Program, which is expected to yield up to $391 million in potential economic gains (2.3 percent of the country’s gross domestic product).
“Policy support and enhanced consumer protections will be expected to benefit rural households, farmers, and small and medium-sized enterprises,” read a statement from the ADB. “The program will upgrade existing financial sector infrastructure to support the introduction of new services and products.”
Despite Cambodia’s economic growth helping to reduce poverty levels from 47.8 percent in 2007 to 13.5 percent in 2014, there are still a large number of locals vulnerable to poverty, according to the ADB – 41 percent of the population live on $2 or less per day.
“The financial sector should be further developed, with only 59 percent of the population having access to formal finance, and about 30 percent of the adult population excluded from any form of financial services,” added the ADB statement.
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