The Asian Development Bank (ADB) and Cambodia Post Bank (CP Bank) have signed a loan of $10 million to support the recovery of micro, small, and medium-sized enterprises (MSMEs) in Cambodia from the Covid pandemic by expanding their access to finance.
At least half of the proceeds are expected to finance MSMEs led by women, ADB said on 7 February.
Micro and small businesses account for nearly all – 99.8 percent – of all enterprises in Cambodia and employ more than 72 percent of the labour force in the ASEAN member state.
Generally, Cambodian MSMEs have limited access to finance, with less than 20 percent of unregistered enterprises acquiring a loan or a line of credit from a financial institution. Most of them are owned by women. The challenges facing female entrepreneurs are particularly acute, with fewer than 5 percent having access to formal credit, ADB said.
“CP Bank has prioritized the development of financing for MSMEs to help them grow and evolve so they can create more jobs and expand their contribution to the broader economy. The assistance from ADB will help us to provide additional financial products and services to these underserved businesses while supporting their working capital and investment needs,” said CP Bank CEO Toch Chaochek.
ADB Vice-President for Private Sector Operations and Public–Private Partnerships, Ashok Lavasa, said, “Improving MSMEs’ access to working capital and longer term financing has considerable benefits, not only for their growth but also for job creation and broader economic recovery.”
“This financing will support the profitability of these businesses by improving their competitiveness and giving them access to domestic and international production networks,” Lavasa added.