Cambodia's Acleda Bank aims to create basic banking services across the country

Cambodia’s Acleda Bank has embarked on a massive programme of expansion in a bid to reach unbanked customers in the country, drawing on core banking technology provided by Swiss banking software company Temenos.

The World Bank estimates that only 4% of Cambodia’s 14.3 million population has a traditional bank account. Acleda is attempting to reach the other 96% by building out its network of branches across the country. To do that, it is using T24 R12, the most recent version of Temenos’ core banking system, and which promises faster processing power, larger data volumes and easier on-boarding for new customers.

Acleda has ambitious targets, including doubling the rate of its customer acquisition over the next five years. The company currently has 238 branches in Cambodia, with $1.9 billion in assets, and one million account holders. “We are experiencing huge expansion opportunities to connect with the unbanked and this upgrade project is part of our aggressive strategy,” said IN Channy, chief executive at Acleda Bank. “We have always been an advocate for T24. Unlike other vendors, Temenos can get a project up and running in six months – time to market being a deal breaker for growing institution like us, which needs fast rollouts.”

David Arnott, chief executive at Temenos, added that the cost of provision would be the key to banking the unbanked, rather than problems of access or demand. Providing economies of scale for Acleda would allow the bank to lower the cost of providing basic banking services.

“With plans in the pipeline from ASEAN to expand the Cambodian connectivity infrastructure to help support the population’s banking needs, it is the opportune time for Cambodian institutions to implement the latest core banking technology,” said Arnott. “This will enable financial institutions to promptly respond to market forces, ensuring the best customer service possible and the lowest cost of provision.”

Acleda Bank is based in Phnom Penh, Cambodia. Originally a microfinance institution, it became a bank in 2004. The company also has offices in neighbouring country Laos and one branch in nearby Myanmar.

In other developing markets such as India, banks have also been keen to target unbanked customers. In November last year, Indian bank ICICI partnered with Vodafone to launch M-PESA, the mobile payment service that allows users to send and receive money on their mobile phones without the need for a traditional bank account. The M-PESA service had already achieved widespread success in Kenya, where it has approximately 18 million users.