New Regulation on Community Saving Groups in Cambodia
MRD confirmed supporting legal entity for community saving groups in Cambodia. Photo: MRD
The Ministry of Rural Development (MRD) confirmed last Friday [June 30th] the new regulation to legalize informal saving groups across Cambodia to manage saving and credit operation to improve community economic sustainability.
Minister of Ministry of Rural Development, H.E. Ouk Rabun, said during the consultation workshop on Community Saving Registration Procedure in Sihanouk Ville that the community saving enable the poor to take part in the group and access to small capital to improve their livelihood while the operations of Micro Finance Institutes (MFIs) and Banks are still limited in their operations to reach out those poor as their clients.
The workshop, a total of 103 participants, was an opportunity to gather final technical input from relevant stakeholder including National Bank of Cambodia, Ministry of Economic and Finance (MEF), Ministry of Agriculture, Forestry and Fisheries (MAFF), Department of Rural Development from 25 provinces and cities, I/NGOs and other stakeholders to improve the contents of the registration procedure.
Group I discussed on the identity and formation process of community saving. Photo: MRD
The groups that will be legalized will have more than 50 members, group capital more than US$ 6,250 and loan portfolio below US$ 25,000 to safeguard the interest of the community saving groups.
During the remarks in that workshop, Oxfam Country Director Solinn Lim appreciated MRD effort to support bigger saving groups.
“Those small saving groups [less than 50 members] are trust-based saving or self-help groups and any regulation imposed on them would be counterproductive, thus we really appreciate MRD decision to not include those groups in this new and important regulations,” Solinn said.
On October 2016, led by MRD, Oxfam and other 9 I/NGOs, MEF, MoWA, MOI, MAFF and NBC jointly formed a technical working group on community saving (TWG-CS) to look at the procedure of the group. The working group participated actively in series of consultation meetings and workshops to provide technical input on the registration. The group anticipates that the new regulation will do no harm to the operations of the small saving groups of less than 50 members. The small saving groups will keep growing freely and serve as platform to deal with issues for a transformational development.
“On behalf of Ministry of Rural Development I very much appreciate the technical working group, Department of Rural Economic Development and I/NGOs stakeholders who have actively engaged and supported community saving group,” said Ouk Rabun. “I strongly believe that the we will reinforce this collaboration and partnership more effectively.”
The technical working group on community saving will improve the registration procedure based on feedbacks from the workshop. MRD committed to send out the final draft of the new regulation to Council of Jurists for final review and edition before submitting to the Prime Minister’s cabinet. MRD hopes to secure endorsement of the regulation from the Prime Minister within this year.