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Mobile Money Providing Cheaper, Safer Transactions in Cambodia


FILE - Garment workers rest inside a factory after their lunch time in Phnom Penh.

FILE - Garment workers rest inside a factory after their lunch time in Phnom Penh.

Every month on her payday, 23-year-old Cambodian garment worker Sot Sorphorng sends her family in Svay Rieng province between $20 and $30 - roughly 20 percent of her wage.

This transaction is a monthly ritual among Cambodia’s 600,000 garment workers whose modest contributions help support the livelihoods of their families in the poorer rural areas.

It was not that long ago that cash in Cambodia was delivered to the provinces by car, which is expensive and comes with the risk that it may never arrive. But with the rapid advancements made in mobile phone technology over the past few years, it is now easier and safer than ever to get money to their families.

“If I send money home via a villager, I have to wait 'til they go back to the village. Sometimes there is someone that goes back to the village, but sometimes there is not,” Sorphorng said.

Virtually everyone in Cambodia today has a mobile phone and more than a third of those living in the rural areas have at least two SIM cards, using multiple providers, according to a report last year by The Asia Foundation.

The study found that more than a quarter of Cambodians now own a smartphone, which is a 30 percent increase from the survey results in 2013.

Cheaper, more efficient transfers

At Cambodia’s largest mobile money service provider Wing, the use of mobile technology to enable money transfers has grown significantly since it was launched in 2008. The company now handles more than 8 million transactions a month, flowing to every corner of the country. In 2013, Wing did more than $1 billion in domestic money remittances.

“The infrastructure in the rural areas is still maturing and not so well established, in the sense that you don’t have a proper mailing address or a better way to reach the village people, for example,” said Khuon Frandara, Wing’s chief commercial officer.

She said the rapid advancement of mobile phone penetration and increased coverage from Cambodian telecommunications firms is driving the industry.

“In that sense, mobile banking is probably the best option to provide financial services to rural people in the Cambodian provinces,” she said.

People send money via Wing’s 4,000 agents stretching across 25 provinces. A deposit is made and a transaction code is then sent to the phone of the receiver who can instantly pick up the money at another vender in their area. Account holders can also simply transfer from one Wing account to another through their mobile phones.

The use of mobile money, which also allows for bill payments and mobile phone top-up, is becoming increasingly popular as Cambodians become more mobile-savvy, according to Frandara.

The chief financial officer points to the success of financial inclusion in places like Kenya, where the World Bank says last year, 90 percent of remittances were sent via a mobile phone; or the Philippines, where in 2014 about three-quarters of those sending remittances did so through a transfer agency.

Economic boost

Despite having a significant impact, money transfers are just a part of how mobile technology has affected rural Cambodians, said Mey Kalyan, a senior advisor to the government’s Supreme National Economic Council.

For example, farmers now have access to market prices and weather patterns in real time, Kalyan said, something that was unheard of just a few years ago.

“It is the link between rural and urban - information now gets through very quickly, providing new opportunities for Cambodia,” he said.

And while rural development does not depend solely on city to country remittance, the ease and affordability of mobile money is helping to subsidize agriculture in Cambodia, he said.

“The importance of the tools; the technology in sending money home through the mobile phone and through various means is extremely crucial to help the poor,” he said. “Before, they just couldn’t send.”

Small contributions

For garment worker Sorphorng, the money sent home to her family helps to support her two brothers to get through high school.

Also funding herself through university on a garment worker’s salary, which is sensitive to even the slightest price movements, mobile technology is providing an affordable and safe transfer option.

“If I send it via Wing when my family urgently needs the money, it will arrive on the same day,” she said. “It is very fast and saves time.”

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