CMA to ask NBC to review interest rate cap

CMA to ask NBC to review interest rate cap A week after the National Bank of Cambodia announced an interest rate cap of 18% applied to all microfinance institutions (MFIs), the Cambodia Microfinance Association (CMA) said it had had discussions with members and plans to submit a request to the central bank to review the cap and help obtain cheaper sources of foreign funding. According to CMA president Hout Ieng Tong, not all institutions would be affected by the cap, as they already offer lower interest rates, but some MFIs will find it difficult to operate. He said each MFI would have to find sustainable strategies to grow and survive, adding that an 18% interest rate would work for loans from $5,000 but not for loans below $1,000. (Source: Khmer Times)