Cambodian MFIs Fear Cash Drought
Hab, H.

Cambodia's MFIs say lower foreign investments in the wake of a global financial meltdown will affect their ability to meet lending targets. "We will not ... reach our target number of customers, but we hope to meet more than 80 percent of customers' [credit] needs," Hout Ieng Tong, chairman of the Cambodia Microfinance Association, told the Post Tuesday.

He said steady loan repayments should limit the impact of market turbulence in the United States and the European Union by partially funding new loans. Delayed or suspended credit contracts could also hit liquidity, he said, but added that direct losses by Cambodian institutions were unlikely because of low exposure to foreign stocks.

Sim Senacheert, general manager of Prasac Microfinance Institution, said foreign lenders are less able to extend credit abroad. "We are having a hard time finding cheap sources of financing because lenders cannot find enough money," he said. He said only long-term, high-interest loans remain available.

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