• Economics

Cambodia Introduces the Code of Conduct for the Banking and Financial Sector

• By Ou Sokmean
• March 5, 2022 4:07 PM

Its aim is both to better serve customers and strengthen the sector, leaders in the field say

PHNOM PENH--The "Code of Conduct for the Banking and Finance Sector" came into effect on March 4 in an effort to strengthen consumer rights and protection as well as increase transparency in the banking and financial sector in Cambodia, sector representatives said. 

"The banking and financial sector code of conduct also helps prevent over-indebtedness and protect vulnerable customers," said In Channy, president of the Banking Association of Cambodia.

Prepared by the Banking Association of Cambodia, the Cambodian Microfinance Association and the Federation of Finance and Technology of Cambodia, Channy said that the code will assist the government and especially the National Bank of Cambodia achieve a stable financial system and market diversification.

The implementation of this code of conduct will contribute to increasing the protection of customers, preventing excessive debts among vulnerable customers as well as responding to the need of domestic financial services, which may help realize sustainable economic growth, increase people's income and reduce poverty, Channy said.

Moreover, this code is in line with the Cambodian government’s financial sector development strategy 2016-2025 and the National Strategy on the Financial Environment 2019-2025, he added.  

Pell Remi​ Sisophon, chairman of the board of the Association of the Federation of Finance and Technology of Cambodia, agreed that this code will determine the relationship between financial institutions and customers, as well as help apply the principles of ethics, integrity, respect for the law, accountability and equity in the field.

Encouraging financial institutions to have confidence in and comply with the regulations, Remi Sisophon said, “[t]he Code of Conduct for the Banking and Finance Sector is very important to implement. Because the main idea of ​​this code is to clearly define the standards and guidelines that each financial institution must follow, simple mechanisms, and [be] able to provide their staff with training so that they can understand and apply properly to resolve conflicts of interest and ensure responsible financing.”

Sok Voeun, chairman of the board of the Microfinance Association of Cambodia, said that the code was established to ensure the sustainability of the Cambodian financial sector by increasing the implementation of professional ethics to serve, provide services to customers and ensure their protection.

The code also focuses on responsible lending through the implementation of lending guidelines and adhering to a client protection path, Voeun said. "The Code of Conduct for the Banking and Finance Sector is designed for the lowest standards so that the members of the three associations can integrate it into their own regulations.

"All companies have until the end of 2022 to improve their systems and policies to ensure that they do not carry out any practices that are lower than the standards set by the code," he said.

Rath Sovannarak, assistant governor and superintendent of the National Bank of Cambodia, said that the code of conduct reflected the goodwill of the association and the attention given to the efficiency of operations in the banking and finance sector.

“In particular, this will enable providing financial services to people with transparency and high responsibility,” Sovannarak said.