Survey Shows Dollar is King

geovalin · October 21, 2016

The US dollar still dominates financial transactions in the Kingdom, with the use of riel remaining limited, according to a survey released yesterday by the National Bank of Cambodia (NBC) in partnership with the Japan International Cooperation Agency (JICA). Using data from 2014 to 2015, the survey looked at the use of dollar and riel by households, enterprises, banks, foreign exchange and microfinance and deposit taking institutions (MDIs).

It found that wages constitute the most dominant use of dollars in terms of income for households, but that most expenditures outside of phone services and rent are conducted in riel. It also noted that households have a high frequency of converting dollars into riel for the purpose of paying for goods and services. While efforts to promote the use of financial institutions have been undertaken over the past two decades, the survey found that the majority of Cambodians do not have a bank account. Even less have an account in riel, the survey found, and that everyday use of the two highest denomination riel notes – 20,000 riel (about $5) and 50,000 riel (about $12.50) was extremely small.

The majority of personal loans are done in dollars, the survey found, but it stressed that in general respondents were supportive of efforts to promote the riel. For foreign exchange, the survey found that the riel was the most commonly exchanged currency, followed by dollars, Thai baht and Vietnamese dong. Approximately $344 million worth of riel is bought each day, according to the survey results.

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