ArrowArtboardCreated with Sketch.Title ChevronTitle ChevronIcon FacebookIcon LinkedinIcon Mail ContactPath LayerIcon MailPositive ArrowIcon PrintIcon Twitter

Interest rate cap rattles Cambodia's microfinance industry

Economic hardship ahead for borrowers as sector braces for contraction

PHNOM PENH -- A recent decision by the National Bank of Cambodia to impose an interest rate cap on loans provided by microfinance lenders has prompted fears that low-income Cambodians, who often depend on small borrowings to stay afloat, will be hit hard.

The central bank on March 14 said microfinance institutions can charge a maximum 18% annual interest rate, compared with 20-30% before. The change took effect immediately and has drawn widespread criticism from industry experts.

Sponsored Content

About Sponsored Content This content was commissioned by Nikkei's Global Business Bureau.

Nikkei Asian Review, now known as Nikkei Asia, will be the voice of the Asian Century.

Celebrate our next chapter
Free access for everyone - Sep. 30

Find out more