Rural Financial Institutions: Start-Ups - The Case Study of ACLEDA Bank

With the banking system in Cambodia as the backdrop, the author traces the origin and evolution of the ACLEDA bank. The bank started functioning in January 1993 as a NGO for small microfinance development and credit, and transformed into a bank in the year 2000. The factors behind this transformation were:

• Financial sustainability of the program;
• Geographically spread operations;
• Adequate capital base.

The paper also provides an overview of the products that the bank offers:

• Loans for micro, small and medium sized businesses;
• Savings and term deposits;
• Local funds transfer;
• Cash management services;
• In-house exchange services.

The paper presents as a summary the operating methodologies of the bank along with the financial performance for the years 2000-2002. Finally, the author lists the lessons learnt and the opportunities and challenges that the bank faces.