Storytelling in Phnom Penh
By Francisco Mira
From a 1 to a 2-needle machine
It’s 35 degrees Celsius, but it feels like 45. We’re riding a Tuc Tuc heading west of Phnom Pehn following one of AMK’s client officers to meet with Emro Saro. Emro is an AMK client who received a R800,000 (USD 200) loan 8 months ago to buy a sewing machine. Sou Chantrea, the client officer, loves to have her as his client as she has never missed a payment.
Emro’s age is hard to tell but I’d say she is somewhere in her 60s based on her stories on how she learned to sew in one of King Sihanouk’s factories. Her two grandsons run around the house while we interrupt her daily work. She does some small jobs for the local garment factory and thanks to her new machine, she can sell around 10 trousers a day providing her a steady income of R300,000 (USD 75) a month. Although she’s increased her income over the last year, she complains about her machine: it’s a one needle machine and it often breaks. In a few months, she’ll open a new loan with AMK and with her savings, she’ll buy a 2 needle sewing machine.
No. 182E – from guarapo to minimart
The next AMK client that we visit lives at lot 182E. Sadly, I’ve lost her name in translation… I’ll call her Channary.
In recent years, Channary was moved from her slum in Phnom Pehn to this new social welfare development in the outskirts of the city. She lives with her 16 year old son, a proficient painter in the 9th grade. When she arrived in the new neighbourhood, she started a sugar cane juice business but wanted to have a MiniMart to increase her income and send her son to school. Several months ago, she met Sou Chantrea (the AMK client officer) and got excited with the loan opportunity. She immediately applied for a R800,000 loan and when she received the money, she stocked up in eggs, soft drinks, snacks, toothpaste, canned goods and all sorts of products. Thanks to her new business, she’s now selling around R80,000 a day and claims to have a 10-25% profit from her minimart.
Her boy shows up in his clean school uniform and he shows us one of his drawings while Channary proudly says that with the next loan that she gets from AMK, she’s going to start selling beer.
A few kids come by and buy some ice from Channary. We buy a few sugus and say goodbye and head back to the city.
Finance at your doorstep
Angkor Mikroheranhvatho (Kampuchea) - AMK started operations in 2003 as a separate microfinance institution from its parent company — Concern Worldwide Cambodia. After a couple of years expanding its market through most of the Cambodian provinces, in 2005, it reached its first annual operating profit. Due to its high coverage of the Kingdom of Cambodia, AMK incurs very high operating costs and very slim margins. This type of operation and continuous growth has only been possible thanks to inexpensive foreign loans from NGOs like Kiva and some European governments.
AMK’s mission is to help large number of poor in Cambodia through the delivery of viable microfinance services. And from 62K clients, 7 branches, and USD 5M in loans in 2003, to 225K clients, 7 branches, and USD 5M in loans in 2003, AMK has become one of the leader MFIs of Cambodia. AMK’s success is based on its high coverage and “finance at your doorstep” motto; AMK client officers can drive their motorbikes for days on remote villages gathering new clients and thus drawing together a ratio of 600 clients per officer.
Despite this success, AMK’s future seems very challenging yet exciting. With the soar of MFIs over Cambodia, frequent loaners have opted to access these institutions on larger scales and clients are now picking up loans from one, two or up to three different MFIs. As result, AMK is not renewing loans for clients with multiple loans and is just focusing on better loans and niche customers. Along with this specializing of loans, AMK is now planning to broaden its services within savings, insurance and money transfers.
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