Cambodia Investment Review

Cambodia and Korea Collaborate on Cross-Border Credit Report Sharing to Enhance Financial Inclusion During 2024 Government Delegation

Cambodia and Korea Collaborate on Cross-Border Credit Report Sharing to Enhance Financial Inclusion During 2024 Government Delegation

Cambodia Investment Review

Credit Bureau Cambodia (CBC) has entered into a collaboration with Korea Credit Bureau (KCB) and Jeonbuk (JB) Bank to establish a cross-border credit reporting mechanism between Cambodia and Korea. The official Memorandum of Understanding (MoU) was signed on 16 May 2024 during the Cambodia-Korea Business Forum in Seoul. The signing ceremony was attended by Hun Manet, Prime Minister of Cambodia, and His Excellency Ahn Duk-geun, Minister for Trade, Ministry of Trade, Industry and Energy. Senior government leaders, central bankers, and executives from credit bureaus, financial institutions, and businesses from both countries were also present.

This initiative aims to develop a cross-border credit sharing mechanism that will enhance access to finance for more than 50,000 Cambodian workers in Korea. Korea is the second most popular destination for Cambodian labor migration, primarily in the less skilled category. According to the latest data from the Ministry of Foreign Affairs of Korea, there are 10,608 Koreans living in Cambodia, and Korea is a significant source of Foreign Direct Investment in Cambodia. As Korean businesses continue to invest in Cambodia, the number of Koreans residing in Cambodia is expected to increase.

Cross-Border Sharing Of Credit Reports Has Become Increasingly Important

With the rise in global workforce mobility, the cross-border sharing of credit reports has become increasingly important. When individuals move to a new country, they often face challenges in accessing credit due to the lack of credit history in the new country. Even if they have established credit histories in their home countries, this information is typically not shared across borders, creating obstacles for credit applications. Credit history is crucial for lenders in assessing loan applications.

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CBC and KCB are working together to address this information gap. Once the mechanism is ready for implementation, it will allow for the retrieval of up-to-date and legitimate credit reports directly from the credit bureau in an individual’s home country. This comprehensive account of the individual’s credit history will enable financial institutions to make more thorough assessments of an individual’s creditworthiness before extending credit.

Seoul, 16 May 2024 – Credit Bureau Cambodia (CBC) has joined hands with Korea Credit Bureau (KCB) and Jeonbuk(JB) Bank.

Jeonbuk Bank, a member of KCB and a leading financial service provider in Korea, is committed to promoting access to finance for Cambodian workers. JB Bank plans to develop customized credit products for Cambodians working in Korea and simplify the credit assessment process by utilizing cross-border credit reports. Furthermore, JB Bank will collaborate with CBC and KCB to explore the feasibility of reporting credit history data of Cambodians in Korea to CBC, facilitating their access to finance.

Exchanges Between Korea And Cambodia Have Greatly Expanded

H.E. Rath Sovannorak, Deputy Governor of the National Bank of Cambodia and Chairman of Credit Bureau Cambodia, expressed his enthusiasm for the initiative. “Cambodia and Korea already have good bilateral relations in terms of trade, investment, and financial sector cooperation. We are happy to additionally bring the two countries under this framework of cross-border credit report sharing that can directly benefit a large number of Cambodians overseas to support their access to credit for improving their quality of life,” he said.

Mr. Hwang Jong-Sup, CEO of KCB, highlighted the significance of the collaboration. “Economic exchanges between Korea and Cambodia have greatly expanded, resulting in an increase in immigration and labor force. We are very pleased to pursue this cross-border credit report sharing initiative with CBC as leading bureaus representing both nations to improve the access of Cambodians to credit in Korea,” he stated.

Mr. Baek Jong-Il, CEO of Jeonbuk Bank, emphasized Jeonbuk Bank’s commitment to financial inclusion. “The MOU stems from Jeonbuk Bank’s unwavering commitment to promoting financial inclusion. As a leading bank to support migrant workers in Korea with financial solutions, we are delighted to collaborate with CBC and KCB to provide Cambodian nationals with an enhanced range of benefits and differentiated financial services,” he commented.

Mr. Sothearoath Oeur, Chief Executive Officer of CBC, expressed his satisfaction with the partnership. “We are pleased to join hands with Korea Credit Bureau, a leading credit bureau in Korea, with our commitment to support a large number of Cambodians living and working in Korea in enabling access to financial services. Financial inclusion of our citizens within and beyond our borders is our key priority. This is the second bilateral cross-border credit reporting sharing collaboration that CBC is planning after it launched the first partnership with Credit Bureau Singapore in March 2023,” he remarked.

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