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Connexus : Issue 37
www.abacus.org.au 49 Connexus Building professionalism in Cambodia Since CUFA began operating in Cambodia four years ago, it has worked in cooperation with partners including the Cambodian Community Finance Network (CCFIN). Instead of having one peak body, credit unions in Cambodia have a number of federations, and CCFIN is one of them. It works with community finance groups including savings groups and associations, self-help groups, village banks and village bank associations. CCFIN members are based in poor rural areas, have few resources and limited capacity, and lack access to educational opportunities. "CUFA has worked with CCFIN in an open dialogue to share materials and ensure that its Building Institutional Capacity program is of maximum relevance to credit unions," says CCFIN executive director Pektry Lay. "Training in Phnom Penh, together with direct field support, have allowed CCFIN members to better understand the unique operating principles of credit unions and their democratic, member-owned, member- focused values. "Technical support from CUFA has helped to strengthen the credit unions' operational capacity, particularly in the area of financial accounting, to provide greater transparency and build trust with members and potential members in the community," he says. Monitoring of CCFIN members shows that CUFA training has led to reduced delinquency rates and more thorough loan management processes. "As the credit unions have employed more principles of best practice, they have earned more trust from the local community and subsequently increased their memberships," says Pektry, but there are still major challenges to be overcome to build the strength and capacity of the movement. People from rural areas generally need a lot of assistance because their level of education is low, and this has an impact on the operational efficiency of credit unions. Also, the lack of credit union-specific regulation and an external governance structure affects the overall trust that members have in the movement. "CCFIN looks forward to continuing to work with CUFA to build the long- term financial sustainability of the movement," says Pektry. Pektry attended last year's CUFA Development Education program and says he greatly appreciated the opportunity to get a better global picture of the credit union movement. Through meeting fellow participants from Australia, New Zealand, Fiji, the Solomon Islands and Timor Leste, he was able to compare and contrast his experiences with those in other developing and developed countries. -- Kundi Lay is country program manager in CUFA's Cambodian office. Technical support and training leads to greater transparency and trust, which in turn increases membership for Cambodia's credit unions. By Kundi Lay "As the credit unions have employed more principles of best practice, they have earned more trust from the local community and subsequently increased their membership."