New Draft Agreement Between Cambodia’s Acleda Bank And South Korea’s KEB Hana Bank Aims To Make Money Transfers Easier

Officials from Acleda Bank and KEB Hana Bank reveal that the new draft agreement between the two banks aims to make money transfers easier "for companies that import Korean goods to settle their invoices and for migrant Cambodian workers to send money home to their families," The Phnom Penh Post reported Sept. 28.

Acleda Bank president and group managing director In Channy says the number of money transactions between the two countries has increased, which is a result of the growing number of Korean companies operating in Cambodia and the rising population of Cambodian workers in South Korea.

With the improving transactions between Cambodia and South Korea, the two largest banks from both countries signed a memorandum of understanding (MoU) on Wednesday "to establish a framework for cooperation across a range of banking services."

"As a result of this cooperation, it will be easier for both workers and companies in both countries," says Channy. "There are many Korean companies operating in Cambodia, and the MoU helps push transactions quicker."

"It helps improve both countries' economies because banking is a backbone of the national economy."

Channy adds that most of the transactions coming from South Korea are money transfers, while the transactions made from Cambodia to the other country are payments for imported goods.

During the first eight months of the year, the Cambodian bank paid $70.1 million worth of trade expenses to South Korea, while Acleda Bank received a total of $130.3 million worth of money transfers from South Korea within the same period.

"Families of [migrant Cambodian] workers in any part of the Kingdom can easily receive the remittances," Channy states.

On the other hand, an official from KEB Hana Bank says the new deal will be a good opportunity for people from both countries.

"The MoU will be a great opportunity for the Cambodia and Korea citizens to access to affordable and convenient money transfer services," KEB Hana Bank Financial Institutions Department Global Head Chi Ok Kim says in a dispatch.

Meanwhile, reports reveal that Acleda Bank added $40 million to its current capital of $226 million just this year as the company plans to expand its domestic and foreign operations.

"In 2015, domestically, here in Cambodia, we will increase our ATM network to up 250 and install 2,500 POS terminals," Channy says. "And we plan to open around 260 offices and increase staff numbers by 11,642 employees."

He adds, "We are also embarking on a substantial upgrade of our management information system to cope with the growth of the banking and financial sector and in particular support our regional expansion."

In addition, Acleda Bank executive vice president and group chief operations officer So Phonnary reveals the company is planning to expand electronic banking and electronic payment systems.

"Not only ATMs but also Internet banking is very important for Acleda," So says, as noted by KHMER Times on Sept. 14. "We have e-banking already but we have to upgrade to a more convenient browser to fulfill user need. We also have to improve our mobile-compatible e-banking services."

She adds, "We also need to think: how can we improve customer service. We will train more human resources [staff] specialized in the terms of service for Asean customers. Also, it is important to work with insurance companies. When [policy holders] pay premiums, they can be used as a source of capital."