There has been a surge in both credit/debit card penetration and widespread acceptance in Cambodia according to Phnom Penh Post. MasterCard, the plastic payment-card brand of global financial services firm MasterCard Worldwide, has been present in the Kingdom since 2001, but until recently it was relatively unknown to most Cambodians.
To date, MasterCard has partnered with 13 banks – including six with foreign-owned banks – in Cambodia to deliver its products.
Currently, the total number of MasterCard credit and debit cards issued in Cambodia grew by 22% during the one year period through March 2016. The company recently announced a partnership with Cambodian bank Acleda, potentially accelerating growth within the next year.
MasterCard’s partnership with Acleda is a step towards a cashless society. The goal is to adopt and grow electronic payment methods and drive greater financial inclusion in the country.
1.4 million debit cards and almost 40,000 credit cards were issued in Cambodia last year. Acleda Bank was the largest single issuer of these cards, with almost 60% of debit cards and over a quarter of credit cards issued by them.
According to So Phonnary, Executive VP and Group COO of Acleda Bank, Cambodians are increasingly using MasterCard for electronic payments, which is why the bank decided it was time to issue its own MasterCard payment cards. Electronic banking is helping to develop payment systems in Cambodia, which can reduce dependency on cash based transactions.
There are also broader economic benefits in using credit and debit cards, cash printing and circulation can cost up from 0.5-1% of a nation’s GDP.
For an emerging market such as Cambodia, the small percentage fraction takes a considerable amount away from the country’s total GDP.
According to Limhong Fashion Shop, it is estimated that 30% of transactions made at the local store are either through MasterCard or Visa. This growth can potentially create more opportunities for ecommerce.
A version of this article appeared in Phnom Penh Post on June 6. Read the full version here.