From the Philippines, I continued my trip via Bangkok to Phnom Penh, the capital of Cambodia. Even though the connection was very tight due to a delayed flight from Manila, I managed to arrive in Cambodia on time. Even my suitcase was there! Kao Kok, our country manager in Cambodia picked me up at the airport and drove me to the hotel. The first thing that struck me was the difference in traffic in Phnom Penh compared to Manila. My Philippino colleagues had already told me that it would look like Manila 10 years ago. The city was indeed much more quiet and relaxed. Cars were in the minority and there were no crazy eight lane roads like in Manila. The next day we visited Seilanithih, which is a microfinance institution (MFI) that has been a project partner of Oikocredit since 2007. After a presentation about the organizations achievements and plans for the coming years, we went to a branch in the province of Kampong Cham. The branch we visited started only a year ago and has approximately 800 clients. Loans are provided primarily for agriculture, business and services activities. Since over-indebtedness is a hot topic in the microfinance world nowadays, I asked the branch manager how he and his staff try to avoid it with their clients. He mentioned that it is very difficult to find the right information. However, if they know the client has already a loan with one of the other MFIs in the area, the loan is rejected. They make not only use of the information the client provides and use information from local authorities or, for example, neighbours. Another hot topic in microfinance is transparency about interest rates. The branch we visited had a sign on the wall which was even understandable for me, although it was written in Khmer (main language in Cambodia). It showed the loan types and amounts with the respective monthly interest rate levels (see photo).
Seilanthih branch manager next to sign with product & interest rate overview.
I also spoke to a few clients in this branch. The first one was Mr. Nuon Mek who is a 39-year-old rice farmer from the village Neang Lerng in Kampong Cham. We met him in the branch when he was making an interest payment (see photo). He has been a client of Seilanithih for 2 years and currently has a loan of KHR 2.5 million (EUR 449) for his rice production. The money is used for seeds, labour and other costs related to the production. With the income from the rice production and some soy bean and cassava production, he is providing for his wife, 4 daughters and 2 sons. The loan from Seilanithih is helpful because before he had only 1 hectare to grow his crops and now he has 3.5 hectares!
Mr. Nuon Mek makes an interest payment in a Seilanithih branch.
Afterwards we visited his place and met with his wife and some other family members. The first time I was in Cambodia, I saw two elderly people in their 70s. Until that moment I had not realized there are hardly any people of that age as a result of the Khmer Rouge regime. About 2 million of the 7 million Cambodians (at that time) were killed by this regime. Almost a complete generation has disappeared… Quite a shocking realization. When we headed home with the car, I wonderied how the Cambodians could still be so tremendously generous and friendly…
Mr. Nuon Mek together with his wife and 3 of his children with part of their rice.
We also met with Mrs. Khiev Orn, a 55-year-old woman who produces cashew together with her husband. For a year she has a 4 month loan from Seilanithih. Before she would finance everything from her own savings or borrow some money from her children that live in Phnom Penh. She has a loan of USD 1,200 to pay approximately 10 labourers during the harvest season to work on the 3 hectares of land. She also uses the loan for fertilizers. During the harvest season she and her husband sleep for 4 months in a hut in between the cashew trees to prevent the nuts being stolen. We also visited her house that was being rebuilt with concrete piles. When I asked Mrs. Khiev Orn who would live in the house while she and her husband were living in the hut, she explained that her children would live there.
Mrs. Khiev Orn showing us her cashew trees.
An interesting detail she mentioned was that she would not immediately sell the cashew nuts but would wait until after the harvest season. Prices are higher outside the season and she would earn a higher income. Smart thinking, I thought. I was happy to have had the opportunity to meet this business woman on the other side of the world!