The usage of Khmer Riel is not just a matter of national pride; it is essential for the country’s long-term economic security and growth. Increased Riel circulation helps Cambodia strengthen its monetary policy, reducing dependency on foreign currencies and minimizing the risks associated with exchange rate fluctuations.
The Khmer Riel (KHR) has had a long history shaped by political and economic changes. First introduced in 1955 to replace the Indochinese piastre, the Riel initially served as a symbol of national sovereignty. However, during the Khmer Rouge regime (1975–1979), the currency was completely abolished, and Cambodia became a broken society. After the fall of the regime, the Riel was reintroduced in 1980, but its value remained unstable due to economic hardships and reliance on foreign aid. Over the years, Cambodia’s growing economy and monetary policies led to gradual improvements in Riel stability, though dollarization remained prevalent. While the Riel gained traction in rural areas and government transactions, the widespread use of the US dollar, especially in urban centers, created challenges for the full use of Riel currency. In recent years, efforts by the National Bank of Cambodia (NBC) and stakeholders, including the Cambodia Microfinance Association (CMA), have strengthened the Riel’s role in the financial system, promoting its stability and increasing confidence in its usage.
By using more Riel, Cambodian businesses and individuals contribute to financial independence, making the economy less vulnerable to external shocks. It also helps stabilize prices, manage inflation effectively, and boost domestic economic activities by keeping financial resources within the country. A stronger national currency means increased purchasing power, greater economic security, and a financial system that is more accessible to everyone. When the Riel is widely accepted and utilized, people experience lower transaction costs and more straightforward financial management, ultimately fostering a more self-reliant nation.
The widespread usage of the Riel is crucial for enhancing Cambodia’s economic sovereignty. A strong national currency reduces reliance on foreign currencies, stabilizes monetary policy, and fosters a more predictable economic environment. By working closely with NBC, the CMA actively supports initiatives that encourage Riel usage across the Microfinance sector, ensuring a more resilient and inclusive economy for Cambodia. It plays a pivotal role in advocating for policies that increase confidence in the Riel and encourage its integration into everyday transactions.
By the end of 2024, the microfinance sector has provided 1.48 million clients with a total loan outstanding of 5.16 billion USD with 25.4% in Riel. Just in 2024, microfinance loan disbursement has reached 3.1 billion USD with 28% in Riel. Total deposit via the four Microfinace Deposit-taking Insitutions has reached 2.54 USD billion with 16.4% in Riel from 2.12 million accounts. This has indicated that the sector is committed to maintaining its Riel more than 10% of the loan portfolio as required by the law.
Additionally, as our journey navigate through digital financial transaction landscape, it is very convenient to use Riel in the payment transaction. Bakong, NBC’s blockchain-based payment system, is the payment innovation system that moves people from traditional way of cash handling transaction to cashless transaction in Riel just in one click reduces both risk and time consuming. The number of Riel transactions via Bakong in 2024 has reached almost 300 millions, 334% increase from 2023. The Riel contributed 49% of total 608 million Bakong transactions in 2024.
The journey toward greater use of Riel requires a collective effort from financial institutions, individual clients, businesses, policymakers, and the public. CMA is committed to working alongside NBC and all stakeholders to foster a strong, stable, and widely usage national currency. Through continued collaboration, education, and financial innovation, we can build a more self-reliant and prosperous Cambodia. CMA encourages all Cambodians to embrace the Riel, reinforcing national pride and economic resilience. Together, let’s strengthen our Khmer Riel currency, connecting past to present and empowering the future of Cambodia.
