The CEO of the Credit Bureau Cambodia (CBC), Oeur Sothearoath, explains how the institution is leveraging on digital platforms to improve credit monitoring so that both lenders and borrowers have easy and transparent access to credit.

What prompted the CBC to launch the CBC Mobile app in November?

With more and more consumers in the Kingdom adopting smartphones and mobile banking, we wanted to enable convenient and smart access to financial health check services to Cambodians at their fingertips from anywhere and at any time.

The CBC Mobile app allows users to check their credit score, credit reports and receive credit monitoring alerts.

Consumers who perform regular financial health checks by accessing credit reports and scores and receive credit monitoring alerts are able to ensure better credit management practices to improve their creditworthiness when lenders conduct credit risk assessment.

This is part of our initiative to digitise consumer services to improve financial literacy and inclusion in an efficient and convenient way.

How can this product contribute to enticing more Cambodians to carry out financial health checks?

The CBC’s Q3 report stated that “the total number of credit accounts saw an increase of 0.28 per cent bringing it to a sharp 1.27 million accounts”.

However, the number of individuals who check their personal credit reports is still limited although growing at a fast rate. We want to encourage consumers to regularly check their credit reports as all lenders also access such reports every time they carry out loan assessments.

So by checking credit reports regularly, an individual active in the credit market can stay in control of one’s credit profile to utilse highest level of benefits from the lenders.

Through the mobile app, individuals can also access their credit score, something that was not previously available to consumers.

Credit monitoring alerts not only enable subscribers to be updated on any changes in the credit history of consumers but also keep track of any unauthorised use of their identity or any unauthorised activity in their loan account.

The CBC said on November 29 that it is “attempting to fill what it perceives to be a service gap in the country’s growing credit and financial sectors”. Could you elaborate on this?

While a lot of lending institutions have been receiving benefits from our information and analytics solutions, there is still a large gap in the consumer segment who can benefit from our financial health check services.

There are information asymmetries for both lender and borrower in the credit market.

Reviewing one’s credit report and score regularly allows consumers to be aware of what lenders may see and also identify and detect any inaccuracies in their information.

CBC Mobile enables consumers to access an integrated platform to utilise all financial health check solutions conveniently, remotely and securely.

Will digital transformation in credit risk management encourage quick decision making and bring greater transparency to risk profiles?

The CBC’s solutions are geared towards filling the information asymmetry gaps in credit risk assessment and make quick and reliable decisions that directly enable digitalising and automating credit risk management for lending institutions as the economy is digitalising.

With the vast amounts of data and analytics we provide from across all financial institutions – something a lender would normally not have access to otherwise – we promote transparency in the credit markets by helping identify risky as well as profitable customer profiles.

We already offer digital platforms that allow integration with the financial institutions supporting them to access our solutions efficiently.

We also enable lenders to utilise their internal as well as external data from the CBC and other sources to adopt automated decisioning solutions which will improve overall efficiency and speed on credit operations.

Our Data Analytics Report (DAR) is an online tool that enables member financial institutions to regularly monitor their credit risk performance as compared to the industry as well as specific sub-segments to ensure competitive position in the market.

How will the app allow the CBC to conduct credit assessments on individuals by creating new scorecard models?

The CBC does not conduct credit assessment of individuals but provides information and analytics solutions to lenders to enable them to conduct credit risk assessment of individuals and businesses.

The mobile app enables individuals around the country to conduct their financial health check to maintain responsible credit management behaviours to fully utilise the benefits it can offer to them in borrowing.

Digital lending models are constantly evolving and so are credit scoring methods. How is the CBC keeping pace with changing trends?

While digital banking is growing fast in Cambodia, digital lending is still new.

Credit scoring and eKYC (electronic Know Your Customer) based on both traditional and alternate credit data are important factors in enabling digital lending.

Our recently launched mobile app provides a certain degree of remote KYC checks and makes credit score available to consumers as well.

This indicates our readiness for being an enabler for digitalising credit risk management.

We recently enhanced our K-score to better address evolving trends in credit market to achieve higher predictive reliability.

Additionally, we also support financial institutions to develop their internal credit scorecards in which we factor in lender specific elements and risks to enable them to adopt robust credit risk models.

Hence, we enable the financial sector to adapt their risk management capabilities at institutional as well industry-wide levels.

Moving forward, we will be focusing on diversifying data sources to harness both traditional and alternate data for enabling financial institutions to adopt broader tools to conduct credit risk assessment.

This will support lenders in assessing credit risk profiles of the new to credit and credit invisible borrower segments as well, thereby leading to greater financial inclusion.

The CBC’s move into the digital forefront also indicates a leap into the more complex data mining field. Is the Cambodian market ready for such complex data mining and does the CBC have the necessary expertise in this area?

With the rapid adoption of digitalisation, mobile banking and fintech, there are vast amounts of data generated at multiple customer touch points that businesses can analyse to generate smart business insights.

With so many new data sources evolving, businesses in Cambodia are in a position where they can benefit from data mining and advanced data analytics products to identify and target value generating customer segments.

Our credit score is one product that uses data mining techniques and advanced analytics.

We constantly focus on upskilling our workforce to ensure they are able to apply the skills in line with rapidly changing market needs.

We are also open to collaborating with external experts and institutions where such synergy brings ecosystem benefits.