The number of active e-wallet accounts in the Kingdom hit 5.22 million last year, a marked 64 per cent surge from 2018, the National Bank of Cambodia (NBC) said in a report on Wednesday.
It also noted that the number of deposit accounts at financial institutions reached 7.62 million last year.
This, it said, is consistent with its efforts to deepen financial inclusion via financial technology, or fintech.
“One of the effective measures to promote financial inclusion is to ensure a cashless society where transactions could be performed digitally, and money transfers/mobile banking is accessible and affordable to every citizen.
“So far, this has been done by private sector players especially PSIs that have been paying much effort to introduce innovative products, that can better serve the market as a whole – people in urban areas as well as the unbanked through their large expansion of mobile and agent network,” said the NBC.
The NBC will launch a Blockchain-based, peer-to-peer payment and money transfer platform in the next few months, its director-general Chea Serey told The Post in January.
Dubbed ‘Project Bakong’, the scheme already has the support of 11 banks, with many more expected to join soon, she said.
Bakong, essentially a quasi-form of a central bank digital currency (CBDC), was launched on a trial basis in July last year, she said, describing the system as “the national payment gateway for Cambodia”.
“Bakong will play a central role in bringing all players in the payment space in Cambodia under the same platform, making it easy for end-users to pay each other regardless of the institutions they bank with.
“Eventually, we hope to allow cross border payment through the Bakong system too,” she said.
Bakong has the potential to bring the unbanked population into the formal financial sector. It will allow for real-time fund transfers and instant payment transactions and incorporate QR code-based transactions.
Phnom Penh Commercial Bank (PPCBank) president Shin Chang-moo, whose bank connected to the system, told The Post that wallet payment services via mobile or other devices are easy to onboard and use at a fraction of the card scheme cost.
But global use is generally limited and transaction security risks abound, he warned.
Shin said: “Bakong will contribute to financial inclusion, a cashless society and even the de-dollarisation of the Kingdom.
“Bakong is in its early stages and has much room to develop and improve, but we can expect the role of Bakong eventually to be expanded as a National Payment System built on Virtual Fiat Money integrating the currently fragmented market.
“More importantly, Cambodia as a sovereign country should have an independent payment infrastructure readily connected to those of other countries around the world.”
In October, Prasac Microfinance Institution Ltd senior vice-president Say Sony, whose institution become a member of the Bakong system that month, said: “Bakong is one of many projects in which Prasac has collaborated with NBC to streamline the payment system such as Fast Service and Cambodian Shared Switch.”
The volume of money transfers via banks and Payment Service Institutions (PSIs) constituted $57.99 billion last year, or 213 per cent of the gross domestic product (GDP), data compiled by the NBC show.
Meanwhile, mobile payments via banks and PSIs equalled 22.9 per cent of 2019 GDP.
Despite remarkable achievements, the development of payment services in the Kingdom continues to face significant challenges.