The Digital Transformation of Microfinance in Cambodia

Chapter 7 discusses how digital technologies are transforming Cambodia’s microfinance sector. Driven by a dynamic FinTech ecosystem and strong government support, tools like mobile banking, e-wallets, AI-based credit scoring, and blockchain-based technology have expanded financial inclusion, especially in rural areas. The National Bank of Cambodia has played a central role through innovations like the Bakong system and regulatory sandboxes. Despite these advances, key challenges remain. Low digital and financial literacy, cyber risks, regulatory shortcomings, and socio-cultural barriers hinder broader adoption. Furthermore, data privacy concerns have grown with digitalization. Cambodia’s digital microfinance model – combining advanced technologies with agent-based outreach – offers valuable lessons. Sustained progress requires a balanced approach that protects consumers, maintains financial stability, and ensures inclusive access to digital financial services.