Slow Credit Growth in Cambodia’s Banking Sector in 2024

• 8 March 2025
• Local News
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In 2024, Cambodia’s banking system experienced slow credit growth, reaching only 3 percent. This modest increase is attributed to the sluggish recovery of key sectors such as construction, real estate, tourism, as well as wholesale and retail businesses.

A report released by the National Bank of Cambodia (NBC) on February 22 revealed that the total banking system credit has risen to 242.9 trillion riels, or approximately USD 59.9 billion. H.E. Dr. Chea Serey, Governor of the National Bank of Cambodia, addressed the reasons behind the stagnant loan growth during NBC’s annual meeting on February 8, 2025.

Dr. Serey noted that the slow rebound in demand from sectors like construction and tourism contributed significantly to reduced borrowing among customers. “On the demand side, it was due to the slow recovery of some sectors, which led customers to scale back their borrowing,” she explained.

On the supply side, increased caution among banks and financial institutions in extending credit has emerged amid heightened regional and global economic uncertainty. “This cautious approach is essential as we navigate these challenging economic landscapes,” she added.

In a more positive development, the report indicated that deposits in the banking system surged by 16.3 percent, totaling 230.9 trillion riels, equivalent to USD 57 billion. Governor Chea Serey expressed optimism, stating that the continued growth in deposits reflects the resilience and confidence in Cambodia’s banking system.

However, the report also highlighted a growing concern with the non-performing loan (NPL) ratio, which climbed to 7.9 percent in the banking sector and 9 percent within the microfinance sector.

The landscape of Cambodia’s financial institutions includes 59 commercial banks, 9 specialized banks, 4 deposit-taking microfinance institutions, 85 non-deposit-taking microfinance institutions, and 114 rural credit institutions, all of which play a critical role in the nation’s economy.

As the banking sector navigates these challenging times, stakeholders will be keenly observing how the landscape evolves in the months ahead.

• Economy and Finance
• Bank and finance