Consumer Credit Index Report: Quarter 4, 2023

Released in February, 2024

Summary of the Q4 report:

Consumer Credit Performance expanded for both the number of loan account and loan balance which recorded positive growth across the regions. Consumer Credit Applications​​ declined compared to the previous quarter. Loan quality as measured by 30+ DPD slightly decreased than the previous quarter as the share of 30+ DPD balance increased across the regions.

• Consumer Credit Applications

Overall, consumer credit applications rose by +5%.

The increase was due to expand in Personal Finance Applications by +7% quarter on quarter, where Credit Card Applications dropped by -14%, and Mortgage Application by -7% from the previous quarter.

• Consumer Credit Performance

The total number of loan accounts saw an increase by +4.49% bringing it to around 1.76 million accounts.

Outstanding balance grew by +0.51% to reach $15.01 billion by the end of the fourth quarter in 2023.

• Consumer Credit Quality

30+DPD as a ratio of the total balance increased to 5.14%.

The majority of customers’ credit (70.07%) remained committed to a single financial institution and 58.73% of customers 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 fourth quarter of 2023, the number of consumers attempting to acquire credit in three different forms – Personal Finance, Credit Card, or Mortgage. The consumer credit application rose in overall with the rate of +5%.  The increase in Personal Finance Applications was +7% with the largest increase of +9% in the coastal and plain regions. There was a drop for Credit Card Applications of -14%, with the largest decrease of -39% in Plateau region. Mortgage Applications decreased by -7%, with the largest drop of -9% in Plain region.

The percentage change in the loan amounts sought through credit application contracted by -10%, which was a significantly drop from the previous quarter of +12%. The changes were due to Credit Card Application amounts contracted of -6% and Personal Finance Application of -11%, and Mortgage Application of -1%.

Consumer Credit Performance:

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

As of December 2023, the number of consumer loan accounts increased by +4.49% from the previous quarter, resulting in 1.76 million total number of loan accounts throughout the country. Out of this number, 80.27% comprised of Personal Finance loan accounts while a much smaller share was recorded for Credit Card loans (8.20%) ​and Mortgage loans (11.53%).  This increase was seen in all regions of the Kingdom (+3.7% in Plateau, +3.0% in Coastal, +5.2% in Plain region, +3.2% in Tonle Sap).

Consumer loan balance continued to rise, increasing at +0.51% as of December 2023. By the end of the quarter, there was a total of $15.01 billion outstanding consumer loan balance.

Although Mortgage loan shares only 11.53% of total loan accounts, in terms of the amount it captured more than half of the total consumer outstanding loan balance with the share of 54.42%, whereas Personal Finance loans accounted for 80.27% and amounting for 44.44%. The share of Credit Card loans in terms of its outstanding balance remained low at 1.14%. Overall, there was positive growth in balance in Plateau +2.7%, and Plain +0.7%, while there was negative growth in Coastal -0.9%, and Tonle Sap -0.1%.

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 increased to 5.14% in this quarter from 4.71% in the third quarter of 2023. Of all the three products, Personal Finance has the highest 30+DPD with the ratio of 6.54%.

The 30+ DPD amount recorded an overall increase of +9.7% across the regions. The largest increase in 30+ DPD amount was seen in Plain region of +14%, Plateau region of +11%, Tonle Sap region of +3%, while Coastal region dropped by -9% quarter on quarter.

The number of customers who held credit accounts with only one financial institution remained high at 70.07% of all customers. The remaining​ share of 29.93% represented those having relationship with multiple financial institutions.

The share of the number of customers holding only one loan account stood at 58.73%; those holding two accounts made up 28.07%; those holding three accounts made up 9.69%; and those with more than 3 accounts were only 3.51% of the entire credit customer base.

“The demand for consumer credit increased in terms of the number and amount of applications; in addition, consumer credit performance was positive in both number of loan accounts and loan balance in this quarter”, said Mr. Oeur Sothearoath, CEO of CBC. He added that loan quality dropped with an increase in 30+ DPD ratio​ of 4.71% in the third quarter of 2023 to 5.14% in this quarter.

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Note to editors

1)  The full report is attached to this message

2)  For the purpose of this report, Cambodia is classified in 4 regions: Tonle Sap, Coastal, Plain and Platea

3)  About Credit Bureau Cambodia (CBC)

Credit Bureau Cambodia is the leading provider of credit information, analytical solutions, and credit reporting services to banks, microfinance institutions, leasing companies, credit operators and consumers in the Kingdom of Cambodia.

CBC was launched in March 2012, with strong support from the National Bank of Cambodia (NBC), the Association of Banks of Cambodia (ABC), the Cambodian Microfinance Association (CMA) and the International Finance Corporation (IFC). CBC promotes greater financial stability by providing accurate real time data to consumers and industry that helps them control the financial aspects of their businesses. It allows businesses to manage credit risk, prevent fraud and automate decision-making. CBC also helps individuals to check their credit report to ensure they have access to loans and finance and to protect themselves against identity theft.

CBC is a joint venture between Credit Bureau Holding (Cambodia) Limited (CBHC) and Equifax Cambodia Holding Pte Limited (ECH). CBHC is comprised of banks and microfinance institutions in Cambodia. ECH is a joint venture between Credit Bureau Asia Holdings Pte Ltd (Singapore-based company) and Equifax Inc. (United States-based company) that collectively have a significant global footprint operating leading credit bureaus.