I am thinking of taking early retirement and moving to Cambodia. Will have about US$750k to invest. I see some pretty attractive fixed deposit interest rates at some of the MFI’s like Prasac and LOLC. Has anyone invested considerable sums with any of the MFI’s and how concerned are you about the security? As far as I can tell, none of them have fallen over in recent times and most have huge financial backing from places like Sri Lanka, Japan and Hong Kong.
Also, what is the taxation rate on income derived from fixed deposits for residents?
Many thanks
Tom

I'd go with this:

Asia_Off_Grid wrote: ↑Tue Jan 30, 2018 2:48 am I live by the following rule:-

Never invest more in Cambodia than you are willing to walk away from.

I suggest investing the bulk of your money in New Zealand or Australia.

If you want to invest a small proportion in Cambodia, go ahead. Stick to US dollars, the riel will be devalued one day.

There are a lot of scams in Cambodia. You could lose your money, even in what appears to be a genuine investment.

So the question is, what is a good investment in New Zealand or Australia?

A story I heard.

Somebody transferred a large amount of money to a Cambodian bank.

Some time later he was arrested. He was falsely accused of molesting children, and was asked to pay a large bribe.

When you deposit a large amount of money in Cambodia, they know who you are. They have connections, and dont have morals.

Expect to be scammed one way or another.

I have heard so many stories of things happening in Cambodia that would not happen in New Zealand or Australia, I will never invest a large amount of money in Cambodia.

I'd go with investing it in your own country, whether in investment property bringing in rent, or in blue chip shares that pay good dividends. You can get 6% return or more without the risk of bringing your money into Cambodia.

TomPalfi wrote: ↑Tue Dec 18, 2018 12:23 pm I am thinking of taking early retirement and moving to Cambodia. Will have about US$750k to invest. I see some pretty attractive fixed deposit interest rates at some of the MFI’s like Prasac and LOLC. Has anyone invested considerable sums with any of the MFI’s and how concerned are you about the security? As far as I can tell, none of them have fallen over in recent times and most have huge financial backing from places like Sri Lanka, Japan and Hong Kong.
Also, what is the taxation rate on income derived from fixed deposits for residents?
Many thanks
Tom

Regarding the safety of MFI deposits, I think it depends on where you think we are in the economic cycle. Cambodia has been booming for a while now, with China and others pouring a lot of money in. I wouldn't want money locked up in an MFI if there was a major economic slowdown here.

Most MFIs that were allowed to take deposits have been taken over by international banks and some of them converted into banks. One consequence was that they offer now much reduced interest rates.

Cambodia has an MFI association and the MFI's get audited. So things are rather transparent. Check online.

I failed to make sense out of Philipp Capital. Very non transparent company. They took over Kredit. What made me think was that one customer got a huge credit from Kredit. Looked like Philipp Capital had taken money out of the company. So for the time being, I dont touch Kredit.

As for the other banks/mfis you might like to split your investment up and reduce risk. Depending on how you do it you can get an average of say 7.6 to 7.8 % after tax (resident rate) p.a. unless you can negotiate a higher rate. I m talking USD.

Important is to realize that interest on maturity does NOT give you compound interest. So if you have a three year contract the interest of year one and two are kept interest-free by the bank. In that case monthly interest withdrawal, usually 0.25% less interest on those contracts, is better.

At the banks talk only to staff higher up the food chain. The counter ladies cannot give you a better rate than the advertised one.

Most important will be to remain silent about your source of income when talking to expats and locals. As for the economic cycle, I dont see any problems the next 2 years. Cambodia is a place where Chinese park their money. That trend can only benefit from trouble in China.

Sathapana is building a huge tower combined with a likewise not so small shopping center (Lotte-Mall). So perhaps not too much to worry about that one.

If you want to invest a small proportion in Cambodia, go ahead. Stick to US dollars, the riel will be devalued one day.

Adorable.

Some time later he was arrested. He was falsely accused of molesting children, and was asked to pay a large bribe.

This.

In today's climate the allegation of child molestation is a virtual death sentence. Due process is suspended; presumption of innocence doesn't exist. And the money puts you on the radar of those in the system who know this and are willing to exploit it.

How many who have been accused are guilty? How many do we not hear about because they paid to get out? And how many of those were actually innocent? Numbers we will never know.

Those Paedos are usually sent back to their home countries where due process is no prob. The real prob for them are those endless nights with the face down on the ground once properly locked away....

Back on topic:
Hattha Kaksekar will give you up to 8% monthly withdrawal and 8.25% at end of term withdrawal. Perhaps more depending on the amount.

The bank/mfi is owned by Bank of Ayuthaya, a Thai bank. The latter belonged to GE financial and is owned by Mitsubishi now. Looks pretty solid to me. I had accounts with Ayuthaya in BKK for over 7 years when living there. Liked them a lot as they were very conservative in accepting foreign clients. Once they did, service was top notch at the main branch. Ayuthaya is not a small enterprise. Branches all over the place.
I have no idea if they offer special facilities for people who need Thai banking, e.g. the 800K baht rule. Their Thai Baht interest rate is way above what you get in Thailand.