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Cambodia: 135 NGOs & communities call for suspension of micro-finance institutions debts & the return of land titles to affected Cambodians amid COVID-19 pandemic

"Suspend MFI Debts and Return Land Titles Amid Covid-19 Pandemic", 27 April 2020

The suffering of millions of Cambodians who are facing economic hardship due to the COVID-19 pandemic is being amplified by the country’s ongoing over-indebtedness crisis, stemming from more than $10 billion in loans from aggressive microfinance institutions (MFIs). More than two and a half million Cambodians currently hold microloans, with an average loan of more than $3,800 – the largest amount in the world. This puts millions of Cambodians’ livelihoods, health and land tenure security at risk.

The government must ensure that MFIs immediately suspend all loan repayments as well as interest accrual on loans for at least three months and return the millions of land titles currently held as collateral by MFIs to their owners…

Millions of workers in the tourism, garment and construction sector are facing layoffs and loss of wages. Government efforts to subsidise these losses have so far fallen short of fulfilling workers’ basic needs. Cambodia’s MFI debt – much of it collateralised with millions of borrowers’ land titles – exponentially heightens the short- and long-term risks of this economic crisis.

We recognise the steps already taken by the National Bank of Cambodia (NBC) to encourage MFIs to offer re-scheduling and loan deferment on a case-by-case basis,…

All people, including MFI borrowers, deserve unhindered access to their land titles – now more than ever…

We strongly urge the government and MFIs to prioritise the health and livelihood of Cambodian borrowers above all else by immediately suspending all MFI loan repayments and loan interest accrual for at least three months as well as returning land titles to their rightful owners...