ABA CEO Askhat Azhikhanov outlines the bank’s rapid rise to the top that has redefined Cambodia’s banking business with an ecosystem empowering individuals, corporations and small businesses.

How do you evaluate the bank’s long journey in Cambodia as ABA marks its 25th anniversary?

While ABA was established in 1996 as Advanced Bank of Asia Limited, the active phase of its redevelopment started in 2009 when the new management team joined the bank, and the ABA brand was introduced to the market.

With the acquisition came a period of significant investment in the bank in terms of IT and infrastructure. The bank turned a profit in 2010 and has been growing non-stop since then.

From the very beginning, we understood the importance of providing quality and convenient financial products to Cambodians. It has shaped our strategy for all subsequent years.

And it still drives us in developing new products and services with the main idea reflected in our mission – to help Cambodian businesses and people build a bigger and brighter future by providing highly professional, technologically advanced banking services for all.

We believe it is this sincerity and customer-centrism that has helped us gain a firm position in the market and become one of the top banks in the Kingdom.

Where do you see the opportunities for further growth coming from?

We have developed a unique business strategy at ABA with two main business arms.

The first focuses on retail customers, when we talk about deposits, card products, money transfers and other bank account management services.

We see massive progress for the bank in this segment – our total number of individual accounts, for instance, has grown 10-fold in just the last five years!

Our introduction of the Kingdom’s first full-scale mobile banking app – ABA Mobile – in 2015 has of course contributed significantly to this growth.

The second arm is lending, where we focus more on micro, small and medium-size enterprise – MSME – clients, who now constitute 78 per cent of our total loan portfolio.

With the steady growth of the Cambodian economy, we see how our microbusiness customers grow into SMEs or large SMEs. We are happy to witness such progress as we position ourselves as a partner to our borrowers and grow together with them.

We regularly run surveys where around 90 per cent of our borrowers confirm that ABA loans helped them reach their business goals. It is a token of a very high appreciation of our efforts.

And even in lending there is a place for technologies that optimise our work and help us build better models and offer better products across market segments.

In the coming years, even decade, we see great potential for further growth of the country’s economy, businesses and people’s incomes.

Hence, we see endless opportunities in bringing together customer needs and our knowledge of finance and technology. This combination brings the steady growth of which we are proud.

How successful have digital banking products been?

ABA Bank has always leveraged technologies both in its operations and product portfolio. We were among the first local banks to introduce an internet banking platform in Cambodia in 2009.

And when we saw the steady and impressive growth in the number of smartphones in the country, we became the first bank to launch a full-scale mobile banking app to let our customers bring their bank wherever they go.

At the same time, our digital banking ecosystem embraces many other products and solutions that make the life of our customers easier and better.

I mentioned the internet banking platform – we revamped it for business use and launched the Internet Banking for Business platform in 2020.

It is now a trusted finance management tool for hundreds of companies of any size, with specifically designed functions for businesses, including account management, cheque management, payments and others.

To cater to the needs of eCommerce and online sellers, we developed our own payment gateway called PayWay. Since its inception in 2018, PayWay was chosen by myriads of merchants and even government agencies to process online payments quickly and securely.

ABA Mobile is now the top free financial app on the Google Play Store and Apple App Store in Cambodia. I think this achievement underlines the success of digital banking solutions and its importance for our customers.

Our key intention for the digital agenda is to make financial services more convenient and easier to use for our valuable customers, be they individuals or businesses.

Around 90 per cent of ABA customers now are digitally active and use our digital banking solutions. It was not always like that – we had to invest significant effort in educating the market and increasing financial inclusion by offering intuitive, easy-to-use products.

ABA is actively promoting self-banking facilities. Is the Cambodian market ready for such futuristic technologies?

Absolutely, yes! Cambodia is blessed by a lack of heavy legacy and affection for old-style banking. Cambodians are embracing new technologies readily, and with smartphones becoming affordable to more people, the demand for self-banking and remote banking will only increase.

Also the pandemic has affected customers’ behaviour, whereby people prefer to stay away from crowds and make transactions when and where it is convenient for them.

Overall, we see a strong trend of the transition of the society towards new technologies and self-banking.

And ABA has the complete set of tools and solutions to offer a seamless experience for its customers, from mobile banking and internet banking to self-banking zones in our branches.

Our most recent innovation is the network of humanless ABA 24/7 self-banking spots where cash deposits and withdrawals, and cheque deposits can be made via machines.

We have already launched 15 such spots in Phnom Penh, Takhmao, Poipet and Sihanoukville, and will be opening even more for the convenience of our customers.

ABA’s customer base grew by a staggering 70 per cent in 2020 – touching 1.4 million clients. How were these impressive numbers achieved?

I mentioned earlier that the ABA ecosystem we are building attracts customers with its simple-to-use yet comprehensive banking and customer support opportunities.

ABA can and does cover an ordinary person’s financial needs, which include money transfers, bill payments, money management, in-store and online purchases, and much more.

We listen to our customers, analyse local and international market trends, and try to offer services that are convenient, secure, and still easy to use wherever they are.

Last year, we enriched the ABA Mobile app with many new features, joined the National Bank of Cambodia’s Bakong project that enables convenient local transfers, launched the network of ABA 24/7 self-service spots and opened several new branches to bring our services closer to more people in the provinces.

We now have 79 branches across the country, and these are still very important for our customers, especially for lending, despite digitalisation.

I think all these activities and initiatives contributed to our customer base growth in the year.

How have ABA’s CSR projects supported community building?

As we are excited to operate in the Cambodian market, we clearly understand the critical social role a bank plays in the life of local communities.

This is why we have placed “contribution” as one of our core values! Sustainable development of society, and especially of its vulnerable groups, ultimately benefits everyone.

In our CSR policy, we strive to support financial inclusion and educational projects, entrepreneurship support initiatives, and other activities that enrich the lives of the people.

We are privileged to support local hospitals such as Angkor Hospital for Children, NGOs that help disadvantaged children, events that nurture emerging startups and digital enthusiasts, and many others.

The bank is also a long-term partner of the Cambodian Tennis Federation and Cambodian Football Federation, where we spread support to national athletes to represent the Kingdom internationally and accept tournaments in Cambodia.

Of course, we adjust our activities based on the needs of reality. In 2020, we funnelled around $200,000 to those affected by the economic downturn caused by Covid-19 and natural disasters in some parts of the country.

This year, as the Covid-19 situation progressed, ABA donated another $1 million to the Royal Government of Cambodia to help mitigate the spread of the virus. For that, we were honoured to receive an appreciation letter to the bank’s top management and staff from Prime Minister Hun Sen.

We see CSR activities as an integral part of our work in helping the bank contribute back to the communities and the country.

However, our main CSR activity is our business itself, where we lend money to our borrowers responsibly, where we manage shareholders’ and customers’ money transparently and prudently, and where we comply with all laws and regulations.

This all makes ABA responsible to the people and the country.

What are your expectations for the future of the Cambodian banking and finance sector?

Looking back at the 25 years of our growth, we see how ABA Bank has grown with the Cambodian economy and society. And we are optimistic about the future of the sector.

There is a lot to be done regarding financial inclusion as Cambodia is still an underbanked country.

The established trend in the industry with more focus on digital and cashless payments will continue.

Foreign and local investments will provide further economic growth.

GDP per capita will grow respectively, thus increasing the population’s purchasing power. All these investments, payments and financing should be processed by the banking sector, which is well set for new growth.

We laud the efforts made by the Royal Government and the National Bank of Cambodia to strengthen the country’s banking and finance industry and look ahead with optimism.

Ultimately, I would like to thank all our customers who put their trust and confidence in ABA, be they a new client or someone who has kept banking with us for 25 years.

We are ready for the next 25 years of development and invite everyone to join us in this exciting journey.

What would your lending strategy be – growing the corporate or the retail portfolio?

Historically, we spread our lending help to businesses of any size working in real sectors of the economy. It comes directly from our vision, mission, and values, where we want to contribute to communities and develop further private businesses.

Therefore, we are ready to support borrowers with economically productive loans that add value to their business and don’t not make the business overleveraged. We also embedded ESG [environment, social and principles, where we would not finance projects that may harm the environment or threaten people's well-being.

With the steady growth of the Cambodian economy, we see how our microbusiness customers grow to SMEs or large SMEs. We are happy to witness such progress since we position ourselves as a partner to our borrowers and grow together with them.

We regularly run a market survey where around 90 per cent of our borrowers confirmed that ABA loans helped them reach their business goals. It is a token of a very high appreciation of our efforts. We are happy to support all our borrowers further, be it a small shop around the corner or a multinational corporation.

How successful have digital banking products been?

ABA Bank has always leveraged technologies both in its operations and product portfolio. We were among the first local banks to introduce an Internet Banking platform in Cambodia in 2009. And when we saw the steady and impressive growth in the number of smartphones in the country, we became the first bank to launch the full-scale mobile banking app to let our customers bring their bank wherever they go.

At the same time, our digital banking ecosystem embraces many other products and solutions that make the life of our customers easier and better. Remember I mentioned the Internet Banking platform? We revamped it for business use and launched the Internet Banking for Business platform in 2020. It is now a trusted finance management tool for hundreds of companies of any size with specifically designed functions for businesses, including account management, check management, payments, and others.

To cater to the needs of eCommerce and online sellers, we developed our own payment gateway called PayWay. Since its inception in 2018, PayWay has been chosen by myriads of merchants and even government agencies to process online payments quickly and securely.

As I speak, ABA Mobile is the top free financial application on Google Play Store and Apple App Store in Cambodia. I think this achievement underlines the success of digital banking solutions and its importance for our customers.

Innovation can be challenging for staff; how do you build confidence among your 6,000 plus employees and make sure they cope with the changes?

The average age of an ABA employee is only 29 years old, and all these young professionals are open to new technologies and trends, ready to try and test new approaches to product development and customer service. With such a team like ours, we will bring many more results and innovations to the market!

Undoubtedly, the bank pays great attention to the continuous development of its staff because the world around us is constantly changing, digital finances are developing rapidly, the economy is growing, and, respectively, business standards and environment are evolving. Here, we rely on the development programmes of our Human Resources Division, who tirelessly train our frontline and back-office staff, hand in hand with respective stakeholders and product owners. The top executives’ mentoring and coaching of the middle management is another key factor to mention, as we have got a diverse and highly experienced executive team.

How has ABA contributed to the development of human capital in the financial sector?

We at ABA are lucky and blessed to have such a great team of professionals who build the ABA story with us. Our people are the core asset of ABA Bank, and we keep constantly investing in human resources by 'creating' more and more Cambodian banking and finance professionals. For that, we established a dedicated ABA Training Center a few years ago, where training is provided regularly to all our staff. It helps to increase human capital capacity in the banking system and the country overall.

For the last five years, for example, we conducted 5,000+ training sessions while the total number of participants reached 154,000. On top of that, we send our staff for external training and professional certification programs in Cambodia and abroad. Our parent bank’s support in human capital development is extensive as well, bringing here the world’s best practices and standards.

What’s more important, ABA staff are very welcome in the market. We don’t have a lot of turnover, but when we see that our people can grow their career further with a different institution or build their own business, we are proud of them as well as of ABA that educates them and provides them with new opportunities.