Spigzy wrote: ↑Thu Aug 15, 2019 9:49 am

Kampoochie wrote: ↑Thu Aug 15, 2019 5:48 am

Spigzy wrote: ↑Sun Aug 11, 2019 2:42 pm

Kampoochie wrote: ↑Sun Aug 11, 2019 12:55 pm

Spigzy wrote: ↑Thu Aug 08, 2019 2:46 pm

Genuinely curious how this would help - did you see how much it cost to transfer money, or how long it took before 2009? Likewise MFIs would charge higher rates to be able to afford to employ loan officers to go and reach places where now they can rely on Wing or others for collections.

Blockchain solutions should/will do away with Wing, which I'm sure was a good solution when it first came about.

Can you elaborate on how you see that working sorry? Reduced system cost for Wing? Removal of the agent in the middle reducing cost for the consumer? I don’t see either working practically in the Kingdom of Wonder, but happy to be wrong!

https://www.asiablockchainreview.com/na ... nt-system/



Correct about reducing the agents in the middle part — just get rid of the banks, get rid of Wing, all transactions are done digitally.

So how do you move (a) illiterate people to use the technology, or (b) change the deeply embedded culture of "middle-men" pervasive in the country? I think you're right, but you're perhaps looking at 2059 for Cambodia, not 2019. Also there is a challenge that no blockchain in existence can handle the trillions of transactions per annum in the USA alone, let alone a country with a massive population, or a truly global financial system. Lots to be done.

I think you're right. Until there's a real user friendly solution (Libra?) the MFI's and Wing have nothing to fear.

Spigzy wrote: ↑Thu Aug 15, 2019 9:49 am

Kampoochie wrote: ↑Thu Aug 15, 2019 5:48 am

Spigzy wrote: ↑Sun Aug 11, 2019 2:42 pm

Kampoochie wrote: ↑Sun Aug 11, 2019 12:55 pm

Spigzy wrote: ↑Thu Aug 08, 2019 2:46 pm

Genuinely curious how this would help - did you see how much it cost to transfer money, or how long it took before 2009? Likewise MFIs would charge higher rates to be able to afford to employ loan officers to go and reach places where now they can rely on Wing or others for collections.

Blockchain solutions should/will do away with Wing, which I'm sure was a good solution when it first came about.

Can you elaborate on how you see that working sorry? Reduced system cost for Wing? Removal of the agent in the middle reducing cost for the consumer? I don’t see either working practically in the Kingdom of Wonder, but happy to be wrong!

https://www.asiablockchainreview.com/na ... nt-system/



Correct about reducing the agents in the middle part — just get rid of the banks, get rid of Wing, all transactions are done digitally.

So how do you move (a) illiterate people to use the technology, or (b) change the deeply embedded culture of "middle-men" pervasive in the country? I think you're right, but you're perhaps looking at 2059 for Cambodia, not 2019. Also there is a challenge that no blockchain in existence can handle the trillions of transactions per annum in the USA alone, let alone a country with a massive population, or a truly global financial system. Lots to be done.

If you were talking about time travel, to say "eh, humans will figure it out, we just figure things out" might be dead wrong — perhaps it's actually impossible. It seems like it must be many centuries away, well after a technological singularity.

With this, it seems safe to say "humans will figure it out." The major concepts and technologies are already there, it's just a matter of implementing it. I'd lean towards saying this will happen gradually throughout the 2020s, and by the time we move into 2030, countries like Cambodia will largely be making everyday transactions with some sort of blockchain system. It will seem very mundane, a slow boil.

If Wing is taking $1 or $5, to answer question (a), you already have very high saturation rates for smartphones in Cambodia. $1 or $5 is still a lot of money for Cambodians, so once an app exists, they will figure it out. You can think about times you've observed Khmer people haggle over 25¢, so this seems obvious.

To answer question (b) about the culture of middle-men, those people have to go somewhere, right? They'll figure out new ways to make money, and it may create new unforeseen problems just like any technology, but it seems nearly impossible to weasel your way into a blockchain transaction.

Re: your last comment about the infrastructure, that seems to go back to the "people will figure it out" thing. The main thing we differ on is the timeline — 2059 seems like a long ways out, I believe the basic building blocks are in place to make it happen in the 2020s.

Sure I’m not denying the technology will slowly get there; nothing in finance moves fast

The Smartphone thing is there already- take SmartLuy as the prime example over the others as it’s completely free; deposit $0.00, send money $0.00 (up to $2k), withdraw $0.00. End to end, entirely free, AND also has agents like Wing nationwide- but I’d wager Wing has more customers by far. Folks here are slow to take up new tech, hence my pessimism until the current 40+ generation has effectively expired! .

my Khmer wife got into debt to buy morphine for her dying father and then pay for his funeral...
took me a while to get to the bottom of this story.
she put up her rice field as collateral...
been paying $100/ month....last payment june 2020.
since, her sister, co-owns the land...i could see this being a big issue down the road.. another loan..
if she was not such a great lady, frugal person, devoted Buddhist and loving wife I would feel very skeptical.....as opposed to just ... skeptical...
credit card debt is just as bad in USA..and what I saw in Argentina was even worse...
credit is modern day slavery...

Spigzy wrote: ↑Sun Aug 18, 2019 9:14 pm Sure I’m not denying the technology will slowly get there; nothing in finance moves fast

The Smartphone thing is there already- take SmartLuy as the prime example over the others as it’s completely free; deposit $0.00, send money $0.00 (up to $2k), withdraw $0.00. End to end, entirely free, AND also has agents like Wing nationwide- but I’d wager Wing has more customers by far. Folks here are slow to take up new tech, hence my pessimism until the current 40+ generation has effectively expired! .

I agree Wing has far more customers at the moment, I don't think anyone would question that. The bank account or credit card thing is a huge hurdle, in my experience. I've gone through the process of getting a URL for some people, for instance, and it's just a massive headache for them to get one without my help.

I maybe disagree about a Khmer readiness to take up new technology — PassApp seems like a good illustration of that. My experience has been the drivers are in way over their heads: they maybe can't really read a map, can't really read period, and their only ability to navigate is by saying something like "it's by such and such wat." With half of them, how they ever find anyone is a miracle. And a lot of them just give up.

Aside from being a shitty and at times abusive situation for them to find themselves "employed" in, they were more than ready to jump into this new world with PassApp, because what other options were there? Foundational things like "can you read a map?" were just brushed over, and despite all of its failures, I suppose some free market pressures will make it get better. Gradually. I generally take uber now when I can, although I might use PassApp or Grab now and then.

A long read:
Cambodia’s Debt Trap: Taking Out New Loans to Pay Back Old Loans
A new report suggests microfinance may no longer be working in Cambodia, where the industry holds at least $8 billion in outstanding debt and the average debt is about three times the 2017 GDP per capita.
08 September 2019

Angkor Chum district, Siem Reap province — Two years ago, Phel Hoeun, a mother of five, used the title to her home as the collateral to borrow $8,000 from Thaneakea Phum, a microfinance institute in Cambodia.

Once approved, she used the money she had borrowed to purchase a four-hectare plot of land.

Phel Hoeun, 47, is a laborer, her income dependent on the daily needs and whims of employers. She envisioned planting the land with cassava, which is used to make flour, tapioca and animal feed. But between meeting daily expenses and the monthly $300 loan repayment, everyone in her family needed to leave their land to find work. Like hundreds of other Kok Doung commune residents here, Phel Hoeun and her family could not afford the time to farm.

In June, Phel Hoeun sold half the land she bought with the loan from Thaneakea Phum to pay off a debt from private lenders she had tapped for the money she needed to pay the microfinance institute (MFI) because even with the extra land “we did not make money,” she told VOA Khmer.

Now, after selling half the land she intended for cassavas, out of the original $8,000 Phel Hoeun still owes U.S $6,000 to Thaneakea Phum, which has been renamed LOLC.

To help pay the rest of the LOLC loan, now due at about $200 a month, Phel Hoeun’s husband works as a laborer in a nearby district. He makes around $5 per day. Her daughter left home to work in Thailand. She earns from $6.50 to $9.70 per day.

Each gives Phel Hoeun what they can, when they can, because their incomes are irregular, dependent on day-by-day demand for their labor. The loan demands a regular $200 month-by-month repayment over the next four years.
https://www.voacambodia.com/a/cambodia- ... 74618.html

Micro-loans raise major questions in Cambodia
Andrew Nachemson
Published 24 Sep 2019
A recent report in Cambodia detailing human rights abuses in the microfinance sector has prompted government outcry – not against predatory lenders, but against the organisations and journalists who exposed them.

The study, released by Licadho and Sahmakum Teang Tnaut (STT), paints a picture of an abusive industry that is drowning Cambodians in debt, forcing them to sell their land, migrate for work, and reduce the quality and quantity of food.

Even if an international investment fund has good intentions, once it enters into an agreement with a corrupt government and local businesses used to operating in that environment, corruption is almost inevitable.

The Cambodian government has pointed to the study’s low sample size of 28 households, and the Cambodia Microfinance Association dismissed its findings. But the results of the report are consistent with a growing lack of faith in the once-heralded industry.

From India to Nicaragua to Lebanon to Mexico, mass suicides, riots, predatory loan behavior, and over-indebtedness are all part of microfinance’s fraught history. The industry, developed by economist Muhammad Yunus, was hailed as a way to eliminate poverty. Yunus, who won the Nobel Peace Prize in 2006 for his work, has since lamented he “never imagined that one day microcredit would give rise to its own breed of loan sharks”.

“Microcredit should be seen as an opportunity to help people get out of poverty in a business way, but not as an opportunity to make money out of poor people,” he said at the United Nations in 2010.

But rampant over-indebtedness suggests that the more-than $100 billion industry is now doing just that, with Cambodia’s $8 billion industry only a single example in a global trend.

Critics point to differences in how microfinance is handled today in comparison to Yunus’s original model.
More here: https://www.lowyinstitute.org/the-inter ... s-cambodia

Those charities have axes to grind.
I think when this article came out people on this forum questioned the size of the study.

It’s not like the west has any debt.

Microcredit is a fair way to support development when a fair amount of interest is involved. The Cambodian system is over the top with 6-8% for savings and double that for small loans. Try to make a starting business profitable with that burden.

What can be done ?

The Macro Challenges in Cambodia’s Microfinance Sector
A closer look at an alarming trend.
By David Hutt
October 03, 2019
[excerpt]
Separately, sources familiar with the situation have told me that international backers are very concerned about the state of the Cambodian microfinance sector but are wary of taking action in case it affects microfinance sectors in other countries, which aren’t having as many problems as Cambodia. People have also spent their entire careers believing that microfinance is the magic free-market solution to global poverty, and admitting faults in one’s world view is difficult.

The problem for the Cambodian government, however, is that there isn’t too much it can do about the problem, short of intervention in the industry, which could cause some panic within the industry and also involve a colossal sum of public money if it was to guarantee some of the debt. The Licadho and STT report recommends the prohibitions of land titles from being used as collateral and end up-front fees. But these won’t help current borrowers, and one ought to be wary of rocking the industry now that so much credit has been extended.

Moreover, the government’s previous attempt at intervention — in March 2017 to impose an 18 percent interest rate ceiling, when rates had previously been as high as 30 percent — wasn’t that well thought-out. Bringing down interest rates allowed more people to extend their credit lines. And the World Bank reported that “in most institutions, the decline in interest rates has been partly offset by a substantial increase in [up-front] fees.”
Full article: https://thediplomat.com/2019/10/the-mac ... ce-sector/