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Financial Inclusion in Cambodia: View From the Top Featuring Wing

There are plenty of defining years in the history books, and as 2020 draws to a close, it’s almost certain that the global pandemic will ensure that this year is featured prominently. With events cancelled, launches delayed, and country-wide lockdowns, the way we work has changed forever. Still, for financial technology and surrounding industries, this was also a year of challenge and opportunity. 

This December, The Fintech Times is asking industry leaders for their ‘View from the Top’ to gain an insight into the decisions behind the last 12-months. Today, we speak to Manu Rajan, CEO of Wing (Cambodia) Limited Specialised Bank, launched in 2009 to help people with little or no access to financial services use their mobile phones to make person-to-person payments, transfers and pre-paid purchases

In this interview, Rajan speaks about Wing’s commitment to improving lives by providing financial inclusion to the unbanked and under-banked population of Cambodia.

How has Wing evolved since launch and what challenges has the organisation faced?

Wing started off in 2009 as an experiment between the National Bank of Cambodia and ANZ Royal Bank. They had looked at Kenya to study how (mobile-based money transfer service) M-Pesa enjoyed big success in driving financial inclusion and they wanted to replicate the same success, or at least try a pilot in Cambodia. For the first three years we didn’t do well at all. In fact, we jokingly say Wing led many firsts in Cambodia over the years, including being the first failed fintech operation. The company was eventually sold off by ANZ Royal to the Royal Group of Companies. It was the Royal Group Management that introduced the now famous agent banking model for Wing that turned around our fortunes. The idea there was that, if customers did not want to use their phone or smartphone to send money, an agent could do the digital transaction for them through an OTC (over-the-counter) transaction. That was the tipping point. From there, we became profitable in 2013 and have remained profitable thereafter.

In that time, we have made a lot of firsts in the Cambodian market. Among other things, we launched the first mobile fintech app here, the first plastic card and first Mastercard for the unbanked, a new line of remittance services with partners like MoneyGram, Western Union and many others that now allow customers to send and receive money from more than 200 countries. One of the biggest challenges we faced in the recent past was when competitors started a price war attempting to capture market share. Wing followed suit and matched prices, but the market value crashed, leaving Cambodia’s mobile financial services and fintech market one of the lowest priced in the world. We are now committed to keeping it that way because most of our target audience includes all the country’s unbanked population. Being accessible and affordable is key to our vision of bettering the lives of every single Cambodian using mobile financial service products.

The way we are structured means Wing enables a lot of transactions. Wing’s total transaction volume last year was almost 90 per cent of the national GDP. After reaching that kind of scale, the biggest challenge for us is to plan what comes next. This includes constantly re-thinking our positioning: Are we a money transfer company, or are we something else? That was the biggest challenge, considering the bigger perspective. We were a money transfer company, yes, but moving forward, we are really looking at ourselves as an ecosystem builder. Already, we have built an amazing agent-driven banking ecosystem of almost 8,000 agents who cover every single district and almost every commune in Cambodia. Interestingly, 80 per cent of these agents are women, who are stay-at-home mothers earning a second income for their families.

How do you think the mobile phone has developed in Cambodia as a popular vehicle for payments and transactions?

We have about 128% mobile penetration in Cambodia and high internet usage as well. In so many places, whether in Cambodia or any developed country, the mobile phone has become like an extension of the self. Here, many people always carry their phones, even in the villages. That might not always be a smartphone, but we do see smartphone penetration is relatively high and a lot of people, especially young people, are already comfortable enough to pick up and use Wing services on their own. We have learned the three important factors that drive the adoption of digital payments are trust, self-confidence and use cases.

In Cambodia, what has become successful are agent-led or assisted digital payments, but the increasing mobile penetration and especially the smartphone penetration tells us the younger generation will be more likely to use these services themselves. The median age for Cambodia is about 25 years and more than 50 per cent of the population is younger than that.

How easy is it to predict customer behaviour? Have you noticed a difference between individual and agent usage?

That comes back to those three things I just mentioned. First is trust. The person has to trust the brand and make sure they’re OK with using its services. The second is self-confidence. Most of the time, when you are looking at the unbanked customers, they may lack self-confidence in using these services. For example, what we see is that, if an unbanked customer gets paid $200 in one month and half of that goes to their parents back home in the village, they might not feel confident enough to carry out the transaction themselves, thinking they might make a mistake and send a substantial amount of money to the wrong person. So, they hand over the cash to the agent and ask them to send it, even though that incurs a fee and doing it themselves would be free.

The third thing is the profile of use case – there are certain use cases that are better supported by an agent, such as bill payments, but others, such as bank transfers, where it’s more convenient to do it yourself. So, we have created more use cases in the past two to three years that are more suited for self-usage, which led to a decrease in agent banking as a percentage of our transactions. That has been a gradual shift that we hope to accelerate in the coming year.

How do you think digital currencies are going to affect traditional payment systems in Cambodia?

Looking back 40 years ago, during the civil unrest here, the currency of the day was abolished, and Cambodians were using rice to barter. Jump forward to today, and we are one of the very few countries in the world that has a blockchain-based interoperability platform, called Bakong, to facilitate digital payments. So, we can say Cambodia as a country has already come a very long way in adopting digital currencies, and we are all quite proud of that.

Wing was the first fintech to be on board when the National Bank launched Bakong. Cambodia today has more than 100 financial institutions, so to have a unified platform like Bakong will facilitate a lot of integration between these disparate FIs.

Bakong can also bring great complimentary value to companies like ours in terms of linking that platform’s access to funds from different FIs to our expansive customer base through our agent network.

It’s worth noting that Bakong is not a cryptocurrency. It is a digital currency, backed by fiat currency, that is enabling these transactions.

How do you see the rise of other digital currencies in other countries?

Simply put, there are two types of economies – those with high banking penetration and those with low banking penetration. For economies with high banking penetration, it is easier to maintain a digital currency because your access to funds can also be digital as well by linking to a bank account. But when you have an economy with low banking penetration, the challenge is finding that physical point where cash can change hands. That is where the agent banking model players like Wing are going to come in. Even if you are a large player wanting to launch a digital currency in Cambodia, the question will be: What is the source of the funds? How are you going to cash in or cash out? For this second types of economy, there is a journey to make before we reach a place where these digital currencies dependent on bank accounts as funding source can compete.

In the UK, we talk about open banking and open data as the key to support financial and social inclusion. Does that resonate with Cambodia?

Yes, and I think we are far ahead when it comes to open banking. On the Wing platform, we have close to 200 APIs connected. We are trying to package these APIs into a bundle to help the industry, so they don’t have to go and individually integrate with different operators. So, if somebody wants to do a phone top-up, then we will offer a bundled package and they can just integrate with the one API. Staying open-minded to open banking has really helped us drive financial inclusion in the market.


  • Polly is a journalist, content creator and general opinion holder from North Wales. She has written for a number of publications, usually hovering around the topics of fintech, tech, lifestyle and body positivity.

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