Microfinance in Cambodia

I Before you listen, match the words with their definitions

1. Loan shark E a) to have the opposite result from the one you intended
2. Outfit b) to control something dangerous or powerful
3. Breakneck c) to take something back from a person who is buying it over a period of
time because they cannot continue to pay for it
4. Sustainable d) an increase in an amount of money over a period of time
5. To tame B e) a person who charges large amounts of interest for lending money to
someone, especially when their financial position means they cannot
borrow money from a bank

6. To exacerbate f) to (cause to) move in small waves

7. To backfire A g) very fast or dangerous
8. To repossess C h) to delay something until a later time; to postpone
9. Conscientious i) to make something that is already bad even worse
10. To ripple j) able to continue at the same level for a period of time
11. To defer k) an organization, company, team, military unit, etc.
12. Accrual l) careful and painstaking; particular; meticulous; scrupulous

II Now listen to the recording and answer the following questions:

1. What benefits has microfinance brought?

2,2 milion have a microfinance loan

-Decline in the of use of loan sharks 32% ->>less tahan 6% | 2004-2017 borrowing from formal
sources (9->30%)
o Saved money lower interest rates charged by formal borrowers
o It gave possibilities to found a business have education, medical care
- 48% -- > 24% of below poverty level (23 cents a day) [2007 - 2014] (mainly due to quick economic
growth over that period)
- Improving farming methods and living standards of the poorest
2. What may restrain the industry’s growth?
- High household debts
o long repayment periods
- Word bank over 5 years average debt grow 10 times

3. How did Cambodia avoid crisis?

- Efforts of Central Bank National Bank of Cambodia
o Rised capital requirements
o Obliged to have contact and possibility of complaining(holtines)
o Rules related to marketing loans
o Well-functioning credit bureau
4. Why do borrowers get into trouble?
– CB introduction of na interse rate cap of 18% (backfire)
 – (REGULATONS) microfinance loans must be more that 2000 toussands dollars to be
lucrative\
 Smaller loand are declined by around 45% of lenders right now
- Rise of fees
- Typical loan uses land as coraterral
- Lenders take borowers to court to reposses land (the cost are not worth fighting for, because the
loans are rather low)
- 42 ->51 of landless people
o Sold to repay debts (we don’t know whether these are volontarly)

5. Why are Cambodians’ finances getting worse?

- Will get worse
- Garmound industry 700 000 hit by pandemic
- Perhaps 1/3 of factories stopped working each worker supports 3 other people
- Tourism even harder (2nd most important industry)
-
6. Why is Mr Hun Sen criticised?

-
- June prime minister 25 000 000 a month to help 600 000 families
- 200 000 loans were rescheduled
- Critics (Hun Sen 45 year at the place, increasing repressiveness)
o Growth of deabt
o He said that those who are not willing to pay will have their lands confiscated