Consumer Credit Index Report: Quarter 3, 2020

Published Date: Friday November 6th, 2020

Summary of the Q3 report:

 Consumer Credit Performance showed strong improvement as both loan balance and the number of loan accounts recorded positive growth. The number of consumer credit applications significantly increased for all product groups and across all regions in this quarter. The number of loan accounts increased across all regions besides the Coastal Region where there was a marginal decline. The amount of late repayments 30 days past their due date (30+ DPD) reduced across all regions with the highest decline in Tonle Sap and Plateau regions.

  • Consumer Credit Applications

Consumer Credit applications increased overall by +53%.

The most significant increase was reported in credit card applications surging +87% from the previous quarter, followed by +52% increase in personal finance applications and +50% rise in mortgage applications.

  • Consumer Credit Performance

The total number of credit accounts saw a marginal increase by +0.28% bringing it to sharp 1.27 million accounts.

Outstanding balance grew by +4.35% to reach $9.11 billion by the end of the quarter.

 Consumer Credit Quality

30+DPD as a ratio of the total balance was reduced to 2.42%.

The majority of credit customers remained committed to a single financial institution and held only a single account.

 Consumer Credit Applications

This metric represents intention of consumers to acquire credit in the form of Personal Finance, Credit Card, or Mortgage.

In the third quarter of 2020, the number of consumers attempting to acquire credit in three different forms- Personal Finance, Credit Card, and Mortgage all increased significantly, with an overall rise of +53%.

The largest increase was in credit card applications which increased by +87% with the highest increase of +165% in the coastal region. Personal finance applications and Mortgage applications increased by +52% and +50% respectively.

The percentage change in the loan amount sought through credit application also increased by +57%, significantly greater than the increase in the same period last year (2019 Q3: 11%). This was due to the increase in application amounts across all categories – credit card (+123%), personal finance (+61%), and mortgage (+39%), compared to last quarter.

 Consumer Credit Performance:

 This metric indicates the volume of consumer loan as of the reporting quarter reflecting an active credit market.

As of September 2020, the number of consumer loan accounts slightly increased by +0.28% from the previous quarter, resulting in the total number of loan accounts around the country going up to $1.27 million. Out of this number, 81.12% comprised of personal finance loans while a much smaller share was recorded for mortgage loans (10.58%) and credit card loans (8.30%). This increase was seen in 3 regions of the Kingdom, +3.2% in Plateau, +0.7% in Tonle Sap, and +0.3% in Plain while the Coastal region saw a decrease of -0.9% in loan accounts.

Consumer loan balance continued its rise, increasing at +4.35% as of September 2020. By the end of the quarter, there was a total of $9.11 billion outstanding consumer loan outstanding balance.

Mortgage loans captured more than half of the total consumer outstanding loan balance with 51.51% share while personal finance loans accounted for 47.90%. Although the number of mortgage loan accounts accounted for only 10.58% of the total loan accounts, in terms of amount, it took up more than half of the total loan balance. Credit card loans continued to maintain low share of outstanding balance at 0.58%. Overall, the kingdom saw positive growth in all regions – Plain +5.1%, Coastal +3.4%, Plateau +2.5%, and Tonle Sap +1.5%.

Consumer Credit Quality:

This metric is measured by taking the ratio of loan accounts with late repayments 30 days past their due date, indicated as 30+ DPD. It indicates the creditworthiness and risk of default within the reporting quarter.

The instance of 30+ DPD reduced to 2.42% this quarter from 2.64% in Q2. Of all the three products, 30+ DPD ratio was the highest for credit card with 5.21%.

The 30+ DPD amount recorded an overall reduction of -5% across the regions. The largest improvement in 30+ DPD amount was seen in Tonle Sap and Plateau regions with drop of -7%. Moreover, Coastal and Plain regions fell by -6% and -4% respectively.

The number of customers who hold credit accounts with only one financial institution remained high at 73.99% of all customers while the share of the number of customers holding relationship with multiple financial institutions remained far lower at 26.01%.

The share of the number of customers holding only one loan account stood at 73.99%; those holding two accounts made up 20.92%; those holding three accounts made up only 4.45%; and those with three or more accounts were 0.64% of the entire credit customer base.

“The consumer credit market showed positive improvement this quarter after slowdown in the previous quarter”, said Mr. Oeur Sothearoath, CEO of CBC. He added that “Despite the growth in credit applications and credit performance in consumer credit market, 30+ DPD improved to 2.42% recording drop across all regions in the kingdom.”

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For further information, please contact:

Credit Bureau Cambodia (CBC)

Mr. PHAY Sophal

Tel: +855 86 999 760