Money Matters in Cambodia Country
It’s all about the money! Here’s the head-ups on all you need to know about moving, managing and spending money in Cambodia.
1. What currency I can use in Cambodia?
- Cambodia has its own currency (the riel) that comes in various denominations of paper bills ranging from 50 to 100000.
- When the United Nations entered Cambodia in 1993 the economy became dollarized with the injection of a large amount of the US currency.
- Restaurants, shops and hotels will generally accept larger bills.
- Damaged or torn dollar bills are rarely accepted but can be exchanged at the local money changers for a small fee.
- Cambodia still operates on a predominantly cash-based system.
- However, credit and debit cards are now increasingly accepted at many hotels, restaurants and other retail outlets.
- Card-based payments are still relatively uncommon but this is set to change quickly as the technological framework to support electronic payments is falling into place.
- Cheques are used also, but sparingly.
- Large transactions are generally conducted in dollars, with riel the equivalent of cents as there are no coins in use.
- In rural areas, however, riel is still the dominant currency.
- Many small shop owners and vendors will not take bills larger than $20 for small purchases.
- Damaged or torn dollar bills are rarely accepted, and are sometimes impossible to pass on, but they should be able to be exchanged at the local money changers for a small fee.
2. Are credit or debit cards common in Cambodia?
- An increasing number of Cambodians are switching from cash to cards as Visa and other international credit card companies continue to spread across the country.
- The criteria varies from bank to bank, with some banks offering credit cards to clients whose income is as little as $200 per month.
- Some banks require customers to load credit cards with money to spend, while some are yet to issue credit cards to the market mainly due to the low usage of credit cards in the country.
- A few years ago, almost all cards were savings secured, now real credit cards are becoming more and more common.
3. Can I use ATM in Cambodia?
- Most commercial banks have ATMs, ACLEDA and ANZ Royal having the two largest networks with more than 685 ATMs collectively throughout the country as of the end of 2013.
- Many ATMs also offer international access for withdrawals at a fee, which varies considerably so it’s wise to shop around.
- ATMs offer additional services including mobile phone top ups and payment utility bills.
- ACLEDA has the most branches of any bank in the country and concurrently has the largest number of ATMs, having established their network into the remote areas of the country.
- Most commercial banks have ATMs in major centres and many offer increasingly wide rural coverage.
- Many ATMs also offer international access for withdrawals at a fee, which varies considerably so it’s wise to shop around. Some ATMs offer additional services including mobile phone top-ups and payment of utility bills.
- Note that different banks offer different levels of ATM service—if fast cash is important to you, and you work countrywide, you best choose a bank with wide ATM coverage.
4. Is it easy to move money in and out of Cambodia?
- The Foreign Exchange Law 2007 states money can be freely and reliably transferred in and out of the country through an authorized intermediary via a licensed bank.
- Most banks can transfer money internationally, though funds over a certain amount may take longer to process and require central bank approval.
- Transfers from overseas accounts transit through a correspondent bank in the USA so can take a couple of days, and the correspondent bank may charge a processing fee, as may the originating bank for incoming transfers, or the destination bank in the case of outgoing payments.
- Western Union and MoneyGram services are available but are comparatively expensive.
- For relatively small amounts, ATM withdrawals from an international account can be a cost-effective method of transferring money into Cambodia, especially if you choose an ATM service where the local bank makes no charge.
5. Are mobile banking payment and banking services available in Cambodia?
- With the rise in use of smart phones across Cambodia comes with it a need for banking institutions to adapt to consumer needs.
- This has led to a rapid rise in the use of mobile banking across the country.
- Mobile payment services are now also operating in Cambodia, with WING being the leading electronic money transfer system – transfers are straightforward to make and cost just 6000 riel ($1.50) regardless of the amount transferred.
- PayPal and Google checkout are not currently licensed to operate from Cambodia.
6. Can I use Cheques in Cambodia and how long should I expect them to clear?
- The cheque clearance system in Cambodia continues to develop.
- Currently, it takes between two to four working days to clear a cheque in Phnom Penh and longer in the provinces.
- Cheques made out in foreign currency can be deposited at banks, provided those banks offer accounts in that particular currency, for example; US dollars, Vietnamese dong or Thai Baht.
- Bounced cheques are not particularly prevalent in Cambodia, due to banks being well educated about taking due care when receiving cheques from third parties.
- Also, a bounced check can mean jail time for the writer.
7. Is money laundering a problem in Cambodia?
- In response to mounting concerns from the international business community that Cambodia is vulnerable to money laundering, the Government has tightened up its laws.
- In March 2014, the Council of Ministers approved a sub-decree freezing assets of terrorist organisations and supporting institutions in compliance with UN resolutions.
- In 2004, Cambodia joined the Asia/Pacific Group on Money Laundering, meaning the country must meet international standards to fight financial crime.
- In 2007, a law on money laundering and terrorist financing was passed.
- The next year, a Financial Intelligence Unit was established in the National Bank of Cambodia.
8. What if I am seeking additional finance in Cambodia?
- There is a lack of equity or bond markets in the country meaning alternative investment must be sought through alternative avenues.
- Banks will only usually look to proven character, experience of repaying loans, and then cash flow, or profits from the business.
- Most borrowers in Cambodia do not provide quality financial statements, thus they force the banks to lend with collateral, such as land, pushing most Cambodian SMEs out of the picture.
- The micro-finance sector provides funding to small companies, and is proving a successful utility for small businesses. The sector saw a 44 percent increase in loans in 2013.
- Investors, business angels or venture capitalists are almost non-existent in Cambodia.
- There are a few investment funds looking for mature projects, but for venture capital, there are only a few initiatives in the whole country.
- There has been recent growth in private equity firms setting up in Cambodia, specifically targeting both foreign and local SMEs, but there still remains a gap in the middle of the market.