NO BUSINESS SALES HERE PLEASE, WE HAVE A SECTION FOR THAT IN THE CLASSIFIEDS.
I've been using them since 2011 without problem. But do I really trust them? No.
I use about 3 or 4 of them so I don't have to all the eggs in one basket.
Do checks on the interest they offer. Some of them offer really low rates on normal savings these days (for instance: Sathapana only 1%).
This article is worth reading, https://www.khmertimeskh.com/553945/sp- ... oderating/
Since there is obviously risk involved, I found it important to look into ownership and loan portfolio growth rate among other indicators. I wanted shareholders who have a reputation to lose and moderate, but not too agressive growth.
I only considered the then five largest MFIs, and at that time found Amreth most favorable. They were not paying the highest interest rate.
I also liked that their average loan size was smaller than, for example Prassac’s.
In the meantime, a lot has changed. I believe Prassac and Sathapana may have become banks? I don’t know what that would entail.
I am by no means an MFI expert.
You have to do your own due diligence.
Make a shortlist. Then go on the MFIs’ websites and look at their reports. Find out who owns them and how the ownership has changed over time. Who are they lending to?
MFIs pay a higher interest rates for a reason-risk ( riskier borrowers, riskier country).
Ask yourself, if they are taking 20+ percent from borrowers how do they themselves assess their risk?
I still use them. Unlike with banks in many developed countries, I don’t think there is any deposit insurance though.
It be great to hear where your research leads you and where not.
Not necessarily. Depends on the balance sheet and the %age of NPL (non performing loans). It's actually much lower in most MFI (and Cambodian banks) than in some large western banks with huge mortgage exposure.
NBC financial stability review here:
https://www.nbc.org.kh/download_files/p ... pr2019.pdf
The NBC annual report usually contains the relevant figures on each bank, MDI & MFI to give you more confidence.
ut sint Guinness proxima morientis ori.
tunc cantabunt letius angelorum chori:
"Sit Deus propitius huic potatori."
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